CISA says more than 100 internet-exposed U.S. water and wastewater systems were targeted in July, often through programmable logic controllers connected directly to cellular modems. "That's the first time the feds have put a number on the digital intrusions, but they have yet to attribute the campaign, widely suspected to be linked to Iran, to a particular group," reports The Register. From the report: Suspected Iranian attackers targeted water and wastewater facilities across at least a dozen states in July, including internet-exposed PLCs. While neither federal nor state officials have identified all 12, we know that the cyberattacks occurred at mostly small, rural utilities in Minnesota, Michigan, Georgia, South Dakota, and New Jersey. "This is very serious. What stands out isn't any single incident. It's the scale," Matt Hartman, chief strategy officer at the Merlin Group and CISA's former acting head of cyber, told The Register. "More than 100 water systems with internet-exposed assets were hit in a single month, which points to a systemic vulnerability across the sector, not a run of isolated, unlucky targets," Hartman said. "Much of this infrastructure runs on operational technology that was built for closed, physical environments. It was never designed with the assumption that it would be reachable from the open internet." John Gallagher, VP at Viakoo, an OT and IoT cybersecurity provider, told us that while 100 systems represent a small fraction - only about 0.5 percent - of water utilities in the US, the "real threat is that these are test runs for a larger-scale attack." While the 100-plus water incidents occurred in July, just last week five US federal agencies warned that attackers are using AI-generated exploitation scripts to break into internet-exposed Siemens S7 Series PLCs at water, manufacturing, energy, and other critical facilities. "This appears to be a continuation of the same suite of activity we suspect is affiliated with Iran targeting PLCs," Halcyon Ransomware Research Center SVP Cynthia Kaiser told The Register a week ago. "Iran-affiliated actors and adversaries are actively targeting a wide swath of operational technology because these PLCs underpin essential health, safety, and critical infrastructure across society," Kaiser, a former FBI cyber division deputy assistant director, added. CISA urges organizations to keep PLCs off the public internet, route remote access through VPNs or gateways, replace default passwords, enable stronger authentication, and restrict access to allowlisted IP addresses from trusted OT systems.

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TechCrunch reports that OpenAI released its official report Wednesday on the Hugging Face breach, "offering the clearest picture yet of how an unusual chain of events allowed an AI model to escape its testing environment and triggered a sprawling cybersecurity incident." The AI company says the breach began when an unreleased cyber model, tested without normal production safeguards, encountered an impossible task and chained together previously unknown exploits to escape its environment and compromise systems at OpenAI, Hugging Face, and other vendors. "This incident reflects misaligned behavior in an outlier scenario involving a rare and unexpected confluence of events: the presence of impossible tasks in the ExploitGym evaluation, model persistence over long task horizons, and messages to peer models that caused those models to deviate from their goal," the report reads. From the report: Many of the details in OpenAI's report were previously made public in a Black Hat presentation on August 6, but OpenAI's official report gives a more thorough accounting of the incident, including more detail on the testing that initiated it. The report also gives critical new detail into how OpenAI aims to prevent future incidents, including chain-of-thought monitoring and a more advanced system for halting rogue agents." METR and Redwood Research also conducted third-party assessments of the models' behavior during the incident; both groups are planning to publish their own reports on the incident on it. In broad strokes, the report describes how an OpenAI model was presented with an unsolvable problem in testing and proceeded to chain together previously undiscovered exploits in order to bypass security measures and complete its task. The model initially compromised the Artifactory package management tool in order to gain access to the internet, then compromised various systems across OpenAI, Hugging Face, and other vendors. The report gives critical new details about the models that carried out the breach. The primary model was from the same family as OpenAI's forthcoming Astra model, although the report emphasizes that it was "a distinct model with different post-training, where much of a model's behavior is shaped." Because OpenAI was testing the model's capabilities, it was also unrestrained by the normal classifiers meant to prevent models from compromising digital infrastructure. "OpenAI estimates maximal cyber capabilities by running this evaluation without the production classifiers intended to prevent models from pursuing high-risk cyber activity," the report explains. "These evaluations are important so that OpenAI can measure models' underlying capabilities and design appropriate safeguards." OpenAI says it is adding 24/7 escalation, stronger containment tools, and more chain-of-thought monitoring, which it claims would have flagged the activity more than a day before Hugging Face was breached.

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"The Register has a story about a Windows backdoor that waits silently in memory for a 'magic packet' before springing into action," writes Slashdot reader fred133. "No outgoing traffic, just waiting..." From the report: Like a sleeper cell awaiting activation, a never-before-seen Windows backdoor dubbed Sleepwalker waits silently in memory for one specifically crafted network packet to wake it up and deliver commands using the malware's 23-instruction language. The commands can do everything from running code directly in memory to moving data off the computer. Malware researcher Dominik Reichel discovered the passive backdoor, which also has its own command language, and detailed Sleepwalker in a technical analysis on Monday. "What makes it worth writing up is what that packet carries: not a readable command, but a short program written in a command language of the backdoor's own design," Reichel said. "Its 23 instructions cover scheduling, several ways to move data, staged file delivery and running code directly in memory. Recovering the encryption key is not enough to understand one of these programs. The internal command language must be reverse engineered as well." In addition to having its own command language, it's also notable that the remote host can be a VMware VMCI target instead of a normal network address. "Taken as a whole, the approach here is consistent with a targeted, well-resourced operation rather than an opportunistic one," Reichel wrote. The malware, hidden inside a 64-bit Windows DLL file, impersonates Microsoft's dpapi.dll, part of Windows' data protection API for protecting sensitive data. It exports the same seven functions as the real dpapi.dll, but attempts to forward calls to a file named dpapisvc.dll, which is not a real Windows component. The file also has a forged ESET Management Agent version resource, and loads via side-loading into ERAAgent.exe, the Windows executable for ESET Management Agent. After confirming that its host process is named ERAAgent.exe, Sleepwalker goes to sleep inside the computer's memory, which also helps it remain hidden from traditional anti-virus tools. Unlike most backdoors, which call back to an attacker-controlled command-and-control (C2) server and start receiving commands, Sleepwalker lies in wait, checking every packet that passes through the network looking for a specific pattern - this is called a magic packet. Once it sniffs out a packet that matches the exact pattern, the backdoor decrypts the data and treats it as a command. "Because the backdoor never sends anything out on its own and does not open any obvious listening port by default, tools that watch for connections to known-bad domains or unusual outbound traffic will not see anything unusual," Reichel wrote. "The absence of outbound connections to known-bad infrastructure does not rule out an infection, either. A machine can be fully compromised by this backdoor while producing nothing at all for a network monitor to flag."

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CISA says the Medusa ransomware operation has breached more than 500 U.S. critical infrastructure organizations since 2021, up from more than 300 reported last year. The group has targeted healthcare, government, defense, manufacturing, IT and financial organizations, evolving into a ransomware-as-a-service operation that recruits initial-access brokers and uses stolen data to pressure victims into paying. BleepingComputer reports: The three federal agencies recommended that network defenders secure their networks against the ransomware group's attacks by mitigating security vulnerabilities to protect operating systems, software, and firmware from exploitation attempts. Security teams are also advised to segment networks to block lateral movement after compromise and to block access from untrusted origins to remote services on internal systems. [...] "Medusa developers typically recruit initial access brokers (IABs) in cybercriminal forums and marketplaces to obtain initial access to potential victims," the advisory says. "Potential payments between $100 USD and $1 million USD are offered to these affiliates with the opportunity to work exclusively for Medusa."

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