Chinese threat actors hacked the US Treasury

The US Treasury Department said on Monday that Chinese-linked hackers were able to gain access to ‘unclassified documents’ after compromising the agency’s networks earlier this month.

According to a US Treasury letter addressed to US Senators Sherrod Brown (D-OH) and Tim Scott (R-SC) on Monday – the Chinese hackers gained access to the documents via a third-party vendor responsible for providing cybersecurity services to the agency.

The cybersecurity firm, BeyondTrust, was the first to become aware of the breach, alerting the Treasury Department on December 8th.

According to the Treasury, the hackers broke into employee workstations and were able to access the documents using a stolen key to its cloud-based tech support platform. The letter called the state-sponsored cyberattack a “major incident,” under US Treasury guidelines.

Senior Researcher John Scott-Railton of the Citizen Lab at the University of Toronto posted about the incident on X noting that the “attackers used the platform like a backdoor on Treasury machines where it was installed.”

“Given BeyondTrust's big client list, makes one wonder if other customers were targeted,” he commented.

NEW: #China government hackers breached the @USTreasury through a security vendor

Sounds like it went like this:

STEP 1: First, attackers targeted Treasury vendor @BeyondTrust

STEP 2: Stole #BeyondTrust's key for a remote tech support cloud platform.

STEP 3: Attackers used… pic.twitter.com/jiGXAYDbnN

undefined John Scott-Railton (@jsrailton) December 30, 2024

Attributed to a Chinese APT (advanced persistent threat), the Beijing threat actors "gained access to a key used by the vendor to secure a cloud-based service used to remotely provide technical support for Treasury Departmental Offices (DO) end users,” the letter said.

Once the key was in their possession, the hackers were able to “override the service’s security, remotely access certain Treasury DO user workstations, and access certain unclassified documents maintained by those users," it stated.

Itzik Alvas, CEO and co-founder of Entro Security, a non-human identity and secrets management platform, pointed out that the attackers were able to exploit vulnerabilities in the remote tech support software by “misusing a leaked API key to gain unauthorized access.”

“APIs - a form of interactions that are triggered by both users and machines - are often exploited to provide attackers with outsized access to backend infrastructure and resources,” the CEO explained.

Alvas said that typically, once an API is exposed, “attackers quickly move laterally to identify and compromise additional exposed human and non-human identities (NHIs) throughout the environment.”

BeyondTrust said it once becoming aware of the breach, "immediately revoked the API key, notified known impacted customers, and suspended those instances the same day while providing alternative Remote Support SaaS instances for those customers."

BeyondTrust investigates with authorities

Following incident response protocols, the compromised BeyondTrust service was taken offline, disrupting any further access to Treasury information.

The letter also said that the US Cybersecurity and Security Infrastructure Agency (CISA) was immediately notified and an official investigation was launched with the FBI and other third-party experts.

A spokesperson for BeyondTrust told Reuters earlier Monday that the company "previously identified and took measures to address a security incident in early December 2024" involving its remote support product.

Referring to the statement on its website updated on December 18th, the cybersecurity firm said it had "notified the limited number of customers who were involved." The spokesperson added that "BeyondTrust has been supporting the investigative efforts."

In the website post, BeyondTrust said it had identified a medium-severity vulnerability (BT24-11) within its Remote Support and Privileged Remote Access products, noting that “all cloud instances have been patched for this vulnerability,” and that it had also “released a patch for self-hosted versions.”

Meantime, Tom Hegel, a threat researcher at SentinelOne, said the reported security incident "fits a well-documented pattern of operations by PRC-linked groups, with a particular focus on abusing trusted third-party services – a method that has become increasingly prominent in recent years," although added that BeyondTrust had not officially confirmed the link.

A spokesperson for the Chinese Embassy in Washington on Monday denied involvement, instead stating that Beijing "firmly opposes the US smear attacks against China without any factual basis," Reuters reported.

Alvas said the BeyondTrust breach is a reminder of how important it is "to adopt next-generation, advanced measures to secure every layer of access within the IT ecosystem, both human and non-human."

"To avoid such breaches, organizations must adopt a proactive security posture that includes implementing zero trust principles, enhancing API key and secrets management practices to detect anomalies in real-time,” he added.

CISA and the FBI had no formal comment as of Monday. BeyondTrust says it will "continue to provide regular updates" as the investigation progresses.