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Chinese Threat Actor Activity Drives US Government Recommendation for Encrypted Communications
Arete Analysis
Cyber Threats
On December 3, 2024, officials from the FBI and the Cybersecurity and Infrastructure Security Agency (CISA) recommended that all users move to encrypted communications on their mobile devices. The recommendation was triggered by reports of an ongoing intrusion at AT&T, Verizon, Lumen, and other telecommunications providers by the Salt Typhoon threat actor. This activity was first reported in October 2024, but security recommendations were updated on December 4, 2024. Salt Typhoon is the name given to a Chinese state-affiliated threat actor who has repeatedly made headlines in 2024 for compromising global telecommunications and internet infrastructure companies.
In the latest intrusions at AT&T, Verizon, and Lumen, the threat actor reportedly targeted call records (phone numbers and times of calls) for the Washington, D.C. area, the actual phone calls of targeted users, and the systems the companies use to intake and provide responses to law enforcement requests. US government officials assess the campaign as purely espionage and have no timeline for when Chinese access will be removed from the providers’ networks.
What’s Notable and Unique
Salt Typhoon’s latest intrusions join earlier Volt Typhoon intrusions at internet infrastructure companies identified during the summer of 2024. Combined, these two Chinese-affiliated threat actors are demonstrating persistent, multi-year dedication to widespread access to US internet and telecommunications networks for espionage purposes.
This is not the first telecommunications provider compromise. AT&T notably announced several compromises earlier this year. However, combined Salt Typhoon and Volt Typhoon activity represents a sustained attempt to access these providers, access that has not and may never be fully removed due to the sophistication of their techniques, which leaves user communications at continuous risk.
Although specific individuals were the reported targets of the Salt Typhoon intrusions, Chinese-affiliated threat actors are authorized to use their access, downtime, and skills for financial gain. On December 10, 2024, the US Department of Treasury’s Office of Foreign Assets Control (OFAC) sanctioned one such Chinese national for using access to support Chinese espionage operations and launch Ragnarok ransomware attacks in 2020.
Analyst Comments
The recommendation for end users to use encrypted communications came alongside guidance CISA issued to network engineers and network defenders. The combined guidance reflects the two primary potential victims of Salt Typhoon activity: the initial targets and customers of those targets. All US government intelligence community assessments in the last ten years have assessed that China will continue to intrude in US networks. By leveraging encrypted communications, users and enterprises can better protect their data from espionage and other collateral damage, like ransomware attacks.
Sources
U.S. officials urge Americans to use encrypted apps amid unprecedented cyberattack
Enhanced Visibility and Hardening Guidance for Communications Infrastructure
PRC State-Sponsored Actors Compromise and Maintain Persistent Access to U.S. Critical Infrastructure
Volt Typhoon targets US critical infrastructure with living-off-the-land techniques
US sanctions Chinese firm for hacking firewalls in ransomware attacks
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Threat actors compromised at least 700 education and technology websites in a recent ClickFix campaign by exploiting a critical SQL injection flaw (CVE-2026-26980) in the Ghost content management system (CMS). Adversaries combined the vulnerability with the ClickFix social engineering tactic to steal admin keys and inject a malicious JavaScript that delivers a fake Cloudflare or CAPTCHA verification pop-up, tricking victims into copying and pasting a malicious command into their systems.
What’s Notable and Unique
Rather than targeting the end user first, this campaign is unique in its initial exploitation of the system, followed by social engineering attempts. This hybrid attack style is likely being leveraged to bypass traditional defenses.
This recent campaign also highlights how trusted web properties can be weaponized at scale and coupled with unpatched CMS vulnerabilities. Rather than using the CMS compromise to perpetrate a single attack, threat actors turned it into a supply-chain attack that ultimately affected over 700 trusted websites.
Analyst Comments
As network defenders and their tools enhance threat detection capabilities, adversaries increasingly seek methods to bypass these defenses. By combining vulnerability exploitation, social engineering techniques, and staging for ancillary attacks, this campaign successfully bypassed traditional defenses and inflicted significant impact. Defending against hybrid cyberattacks requires comprehensive security controls beyond simply patching vulnerabilities. Organizations should focus on limiting movement within the environment, detecting abuse of trusted applications, and preventing end-user manipulation.
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Threat Actors Leverage Fake JPEG Files for Initial Access
In a recent campaign, researchers observed threat actors using fake JPEG image files as a delivery mechanism to initiate the deployment of additional malicious components. The false JPEG files are typically distributed via phishing emails or other social engineering-based lures, and are actually PowerShell-based malware that deploys a trojanized version of ConnectWise ScreenConnect to establish and maintain persistence in the compromised environment.
What’s Notable and Unique
This campaign leverages JPEG images as the initial lure, where the images are not merely decoys but part of the infection workflow. Victims are typically led to download or open an image that triggers hidden execution logic or redirects them to a payload-delivery sequence that initiates later stages of the intrusion chain.
The attack chain is designed to blend into legitimate environments, making detection more difficult. Execution typically relies on scripted or native Windows components, often including PowerShell or other living-off-the-land binaries, enabling fileless or near-fileless execution and reducing forensic artifacts on disk.
The multistage design ensures that the initial JPEG does not directly contain the full payload but instead triggers retrieval or decryption steps that progressively assemble the final malicious components in memory.
Analyst Comments
This campaign illustrates how threat actors continue to blur the line between legitimate file handling and malicious execution chains, indicating potential overlap with remote management or administrative tooling. The use of JPEG-based staging combined with script-based execution reflects a broader evolution toward a stealth-first intrusion design, in which file formats serve as triggers rather than payload containers.
Sources
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