Cisco Talos uncovers active intrusion using CloudZ RAT with novel Pheno plugin designed to intercept SMS/OTP messages by hijacking Microsoft Phone Link application. Campaign active since January 2026, targeting credential theft without mobile device compromise.
Key technical details:
• Rust dropper (systemupdates.exe) deploys .NET loader via fake ScreenConnect update, establishes persistence through SystemWindowsApis scheduled task using regasm.exe LOLBin
• CloudZ RAT compiled Jan 13, 2026, uses ConfuserEx obfuscation, dynamic .NET reflection for memory-only execution, and anti-analysis checks (T1055, T1027, T1497)
• Pheno plugin monitors Phone Link processes (YourPhone, PhoneExperienceHost), targets SQLite database PhoneExperiences-*.db for SMS/OTP interception
• C2 infrastructure: 185[.]196[.]10[.]136:8089, staging servers on hellohiall[.]workers[.]dev and pastebin[.]com/raw/8pYAgF0Z
Attack methodology leverages legitimate Phone Link PC-to-mobile bridge to access synchronized SMS data without deploying malware on victim's phone, enabling OTP bypass for authentication systems.
Hunt for regasm.exe processes with network connections, unusual scheduled tasks in \Microsoft\Windows\, and Phone Link database access patterns. Full IOCs and detection rules available in Talos repository.
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