U.S. Treasury Imposes Sanctions on Beijing Cybersecurity Company for State-Sponsored Hacking Activities

In a significant action on Friday, the Office of Foreign Assets Control (OFAC) of the U.S. Treasury Department placed sanctions on the cybersecurity company Integrity Technology Group, Incorporated, which is based in Beijing. The company’s role in planning a string of cyberattacks against American companies is the reason for this action.

Flax Typhoon (also called Ethereal Panda or RedJuliett), a state-sponsored threat actor acting on behalf of the Chinese government, has been openly implicated in these cyberattacks. Last year, Flax Typhoon became well-known for running the powerful Internet of Things (IoT) botnet Raptor Train.

The hacking group has been actively targeting a wide variety of organizations in North America, Europe, Africa, and Asia since at least the middle of 2021. The usual tactic used by Flax Typhoon is to obtain initial access to target systems by taking advantage of known vulnerabilities. They then use genuine remote access software to keep control of compromised networks for an extended period of time.

Chinese cyber actors have been categorically identified by the Treasury Department as a major and ongoing threat to American national security. The systems of the United States government, including the federal agency itself, have been the target of these actors on numerous occasions.

“The Treasury Department will not hesitate to hold malicious cyber actors and their enablers accountable for their actions,” declared Bradley T. Smith, who is the Acting Under Secretary of the Treasury for Terrorism and Financial Intelligence.

“The United States will use all available tools to disrupt these threats as we continue working collaboratively to harden public and private sector cyber defenses,” Smith added.

From the middle of 2022 to the end of 2023, Integrity Group, also known as Yongxin Zhicheng, is accused of supporting Flax Typhoon’s cyber campaigns with vital infrastructure. Integrity Group has been officially designated by the U.S. Department of State as a government contractor with close connections to the Ministry of State Security of the People’s Republic of China (PRC). The business was established in September 2010.