Hackers Using Squirrelwaffle Loader to Deploy Qakbot and Cobalt Strike

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A new spam email campaign has emerged as a conduit for a previously undocumented malware loader that enables the attackers to gain an initial foothold into enterprise networks and drop malicious payloads on compromised systems.

“These infections are also used to facilitate the delivery of additional malware such as Qakbot and Cobalt Strike, two of the most common threats regularly observed targeting organizations around the world,” said researchers with Cisco Talos in a technical write-up.

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The malspam campaign is believed to have commenced in mid-September 2021 via laced Microsoft Office documents that, when opened, triggers an infection chain that leads to the machines getting infected with a malware dubbed SQUIRRELWAFFLE.

Mirroring a technique that’s consistent with other phishing attacks of this kind, the latest operation leverages stolen email threads to give it a veil of legitimacy and trick unsuspecting users into opening the attachments.

What’s more, the language employed in the reply messages matches the language used in the original email thread, demonstrating a case of dynamic localization put in place to increase the likelihood of success of the campaign. The top five languages used to deliver the loader are English (76%), followed by French (10%), German (7%), Dutch (4%), and Polish (3%).

Qakbot and Cobalt Strike

Email distribution volumes capitalizing on the new threat peaked around September 26, based on data compiled by the cybersecurity firm.

While previously compromised web servers, primarily running versions of the WordPress content management system (CMS), function as the malware distribution infrastructure, an interesting technique observed is the use of “antibot” scripts to block web requests that originate from IP addresses not belonging to victims but rather automated analysis platforms and security research organizations.

The malware loader, besides deploying Qakbot and the infamous penetration testing tool Cobalt Strike on the infected endpoints, also establishes communications with a remote attacker-controlled server to retrieve secondary payloads, making it a potent multi-purpose utility.

“After the Emotet botnet takedown earlier this year, criminal threat actors are filling that void,” Zscaler noted in an analysis of the same malware last month. “SQUIRRELWAFFLE appears to be a new loader taking advantage of this gap. It is not yet clear if SQUIRRELWAFFLE is developed and distributed by a known threat actor or a new group. However, similar distribution techniques were previously used by Emotet.”

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