A new malware variant dubbed Squirrelwaffle has been identified which is being distributed via spam emails. Squirrelwaffle was first identified in September 2021, with the number of spam emails distributing the malware increasing throughout the month and peaking at the end of September.
The takedown of the Emotet botnet in January 2021 left a gap in the malware-as-a-service market, and several new malware variants have since emerged to fill that gap. Emotet was a banking Trojan that was used to distribute other malware variants to Emotet-infected machines, with Squirrelwaffle having similar capabilities. Squirrelwaffle allows the threat group to gain a foothold in compromised devices and networks, which allows other malware variants to be delivered.
Investigations of the malspam campaign have revealed it is currently being used to distribute Qakbot and Cobalt Strike, although the malware could be used to download any malware variant. The spam emails that deliver Squirrelwaffle include a hyperlink to a malicious website which is used to deliver a .zip file that contains either a .doc or .xls file. The Office files have a malicious script that will deliver the Squirrelwaffle payload.
The Word documents use the DocuSign signing platform to lure users to activate macros, claiming the document was created using a previous version of Microsoft Office Word which requires the user to “enable editing” then click “enable content” to view the contents of the file. Doing so will execute code that will deliver and execute a Visual Basic script, which retrieves the Squirrelwaffle payload from one of 5 hardcoded URLs. Squirrelwaffle is delivered as a DLL which is then executed when downloaded and will silently download Qakbot or Cobalt Strike, which both provide persistent access to compromised devices.
As was the case with the Emotet Trojan, Squirrelwaffle can hijack message threads and send malspam emails from infected devices. Since replies to genuine messages are sent from a legitimate email account, a response to the message is more likely. This tactic proved to be highly effective at distributing the Emotet Trojan. The campaign is mostly conducted in English, although security researchers have identified emails in other languages including French, German, Dutch, and Polish.
The similarities with Emotet could indicate some individuals involved in that operation are attempting a return after the law enforcement takedown, although it could simply be an attempt by unrelated threat actors to fill the gap left by Emotet. Currently, the malware is not being distributed in anywhere near the volume of Emotet but it is still early days. Squirrelwaffle may turn out to be the malware distribution vehicle of choice in the weeks and months to come.
To counter the threat, it is vital for email security measures to be implemented to block the malspam at source and ensure the malicious messages are not delivered to inboxes. Since message threads are hijacked, a spam filtering solution that also scans outbound emails– SpamTitan for example – should be used. Outbound scanning will help to identify compromised devices and prevent attacks on other individuals in the organization and address book contacts. SpamTitan also incorporates sandboxing, which works in conjunction with antivirus engines. Suspicious attachments that bypass the AV engines are sent to the sandbox for in-depth analysis.
As part of a defense-in-depth strategy, other measures should also be deployed. A web filter is a useful tool for blocking C2 communications, endpoint security solutions will help to protect against Squirrelwaffle downloads, and regular security awareness training for the workforce is recommended to teach cybersecurity best practices and train employees how to identify malicious emails. Employees should be told to never click links or open attachments in unsolicited emails or messages and to be wary of messages from unknown accounts. It is also important to explain that some malware variants can hijack message threads, so malicious emails may come from colleagues and other address book contacts.