Why Nation-State Threat Actors Expand Their Attack Targets into Enterprise

Nation-state actors are no longer exclusively targeting governments or governmental agencies; they are now actively infiltrating enterprises in sectors like telecommunications, healthcare, retail, supply chain logistics, and more. This highlights the urgent need for businesses to adopt robust cybersecurity measures to defend against these sophisticated threats.

Historically, nation-state cyber-threat actors used to focus their attacks on critical infrastructure such as energy grids, transportation systems, and government entities. For instance, in 2020, state-backed Chinese hackers executed a "deep and persistent" breach of Japan's military networks, an incident described by former U.S. military officials as "shockingly bad." The hackers reportedly accessed sensitive military plans, capability assessments, and vulnerabilities, retaining significant access until at least November 2021. Despite early warnings and support from the U.S. National Security Agency (NSA), progress on securing Japan's networks was slow due to Japan's reluctance to allow direct U.S. involvement, a concern fueled by past intelligence leaks. The breach raised alarms about intelligence-sharing between the U.S. and Japan, a key ally in the Asia-Pacific, amid increasing geopolitical tensions and China's heightened interest in Japan's growing military capabilities. The crisis ultimately spurred Japan to launch its own Cyber Command and commit $7 billion over five years to strengthen cybersecurity defenses, signaling a shift toward more robust collaboration between the two nations in countering sophisticated cyber threats.

However, a paradigm shift has expanded their scope to include enterprises, creating a pressing need for businesses to reevaluate their security postures. Recent incidents involving adversarial groups like Velvet Ant, GhostEmperor, and Volt Typhoon showcase this shift. These threat actors have been targeting major organizations, attempting to steal sensitive data and disrupt critical systems. Nation-state cyberattacks are no longer a distant possibility—they are an imminent reality.  

Enterprises Under Attack

The past year has witnessed an alarming rise in cyberattacks, driven by escalating geopolitical tensions. For example, in December 2020, Kawasaki Heavy Industries, a prominent Japanese defense contractor, disclosed a significant data breach resulting from unauthorized access to its servers. The initial intrusion was detected on June 11, 2020, originating from the company's Thailand office and subsequently spreading to other overseas branches in the U.S., the Philippines, and Indonesia. Despite comprehensive investigations, Kawasaki could not conclusively determine whether sensitive information, including personal data and infrastructure-related details, had been leaked. In response, the company implemented enhanced security measures, including establishing a dedicated Cyber Security Group, to prevent future incidents.

Another example highlights the geopolitical dynamics between Iran and Russia. As Iran strengthens its alliance with Russia amidst U.S. and European sanctions, retaliatory cyberattacks are expected to ripple across industries. Incidents like the 2021 Colonial Pipeline attack underscore the fragility of critical infrastructure and the fallout when diplomatic agreements to curb cyberattacks dissolve under the strain of geopolitical conflicts, such as the Ukraine war.

Today, enterprises across industries such as law, media, telecommunications, healthcare, retail, and logistics find themselves in the crosshairs. This vulnerability stems largely from the sensitive data they hold—client information, intellectual property, and proprietary contracts—all of which can serve as a treasure trove for attackers. Moreover, the interconnected nature of global business means that a breach in one organization can cascade through its affiliates and vendors, granting attackers access to an expansive web of critical systems.

Mission vs. ROI: Nation-State Threat Actors vs. Ransomware Groups

To effectively combat nation-state threats, it is crucial to understand their unique motivations. Unlike ransomware groups, which are driven by financial gain and target a wide range of businesses indiscriminately, nation-state actors are mission-driven. These attackers are backed by substantial resources and focus on long-term objectives, including:

• Stealing trade secrets or military intelligence.
• Disrupting critical infrastructure.
• Conducting misinformation campaigns.
• Achieving financial gain under the guise of ransomware attacks.

While ransomware groups prioritize quick returns, nation-state actors dedicate significant time and effort to planning highly targeted and stealthy operations, often operating with advanced technical expertise and persistence.

Unparalleled Technical Expertise

Nation-state threat actors exhibit unparalleled technical prowess. Their operations are meticulously planned to infiltrate and persist within networks. Once inside, they employ lateral movement tactics, reinfiltrate after eradication, and work diligently to erase their tracks. Techniques like modifying security logs, disabling tools, and altering timestamps make attribution challenging, hampering forensic investigations.

For example, Velvet Ant demonstrated persistence by exploiting a legacy F5 BIG-IP appliance exposed to the Internet. This allowed the group to establish a command-and-control (C&C) system, maintaining access to networks for espionage. GhostEmperor, using the Demodex rootkit, resurfaced in 2023 with a campaign targeting servers and workstations. By leveraging open-source tools and deploying advanced rootkits, the group avoided attribution while communicating with C&C servers.

How Potentially Targeted Enterprises Should Prepare

Combatting nation-state cyber threats requires a multifaceted approach. Organizations must move beyond basic cybersecurity measures to implement advanced strategies tailored to this unique threat landscape.

Threat Simulations and Response Drills

Regularly conduct scenario-based rehearsals to ensure seamless coordination during the critical first 24 hours of a crisis. This includes clearly defining roles at both technical and executive levels.

Enhanced Network Visibility

Invest in tools that provide both granular and holistic views of networks and systems. Comprehensive visibility is essential for detecting anomalies.

AI and Automation Integration

Utilize AI-driven threat detection tools to reduce costs and accelerate forensic investigations. Automation can significantly enhance detection speed and accuracy.

Collaborative Defense Strategies

Build proactive relationships with government agencies and industry peers. Sharing intelligence and insights strengthens collective defenses against sophisticated threats.

Dark Web/Deep Web/OSINT Threat Intelligence

While prevention and real-time monitoring with tools like XDR or EDR are critical, they are not foolproof. Threat actors often find alternative ways to target individuals and endpoints, leaving no visible traces in internal event logs. Monitoring what is already compromised and available on Dark Web marketplaces or being shared among cybercriminals is essential. Many victim organizations and key individuals are unaware that their data has already been compromised. Simply identifying what was breached is not enough; understanding why the breach occurred and investigating its root cause are even more critical for preventing future incidents.

By adopting these comprehensive strategies, enterprises can strengthen their resilience against sophisticated nation-state threats and mitigate potential risks effectively.

The Road Ahead 

The threats posed by nation-state actors are no longer abstract; they are here and now. Enterprises must rise to the challenge, not only by strengthening their own defenses but also by contributing to a broader, collaborative security ecosystem.

By fostering open communication and investing in robust cybersecurity measures, organizations can mitigate the risks posed by nation-state actors and ensure resilience against an evolving and formidable adversary. The stakes are high, but with strategic foresight and collective effort, the battle against these cyber threats can be won. 

Quick Takeaways 

Nation-state threat actors have expanded their focus beyond governments and critical infrastructure to include enterprises across various industries.

This shift is driven by:

• The sensitive data enterprises hold, such as intellectual property, client information, and proprietary contracts.
• The interconnected nature of global business, where breaching one organization can provide access to wider networks of affiliates and vendors.
• Strategic motives, such as gaining economic advantages, disrupting industries, or advancing espionage efforts.