How cyberattackers exploit domain controllers using ransomware

In recent years, human-operated cyberattacks have undergone a dramatic transformation. These attacks, once characterized by sporadic and opportunistic attacks, have evolved into highly sophisticated, targeted campaigns aimed at causing maximum damage to organizations, with the average cost of a ransomware attack reaching $9.36 million in 2024.¹ A key catalyst to this evolution is the rise of ransomware as a primary tool for financial extortion—an approach that hinges on crippling an organization’s operations by encrypting critical data and demanding a ransom for its release. Microsoft Defender for Endpoint disrupts ransomware attacks in an average of three minutes, only kicking in when more than 99.99% confident in the presence of a cyberattack.

The evolution of ransomware attacks

Modern ransomware campaigns are meticulously planned. Cyberattackers understand that their chances of securing a ransom increase significantly if they can inflict widespread damage across a victim’s environment. The rationale is simple: paying the ransom becomes the most viable option when the alternative—restoring the environment and recovering data—is technically unfeasible, time-consuming, and costly.

This level of damage happens in minutes and even seconds, where bad actors embed themselves within an organization’s environment, laying the groundwork for a coordinated cyberattack that can encrypt dozens, hundreds, or even thousands of devices within minutes. To execute such a campaign, threat actors must overcome several challenges such as evading protection, mapping the network, maintaining their code execution ability, and preserving persistency in the environment, building their way to securing two major prerequisites necessary to execute ransomware on multiple devices simultaneously:

• High-privilege accounts: Whether cyberattackers choose to drop files and encrypt the devices locally or perform remote operations over the network, they must obtain the ability to authenticate to a device. In an on-premises environment, cyberattackers usually target domain admin accounts or other high-privilege accounts, as those can authenticate to the most critical resources in the environment.
• Access to central network assets: To execute the ransomware attack as fast and as wide as possible, threat actors aim to achieve access to a central asset in the network that is exposed to many endpoints. Thus, they can leverage the possession of high-privilege accounts and connect to all devices visible in their line of sight.

The role of domain controllers in ransomware campaigns

Domain controllers are the backbone of any on-premises environment, managing identity and access through Active Directory (AD). They play a pivotal role in enabling cyberattackers to achieve their goals by fulfilling two critical requirements:

1. Compromising highly privileged accounts

Domain controllers house the AD database, which contains sensitive information about all user accounts, including highly privileged accounts like domain admins. By compromising a domain controller, threat actors can:

• Extract password hashes: Dumping the NTDS.dit file allows cyberattackers to obtain password hashes for every user account.
• Create and elevate privileged accounts: Cyberattackers can generate new accounts or manipulate existing ones, assigning them elevated permissions, ensuring continued control over the environment.

With these capabilities, cyberattackers can authenticate as highly privileged users, facilitating lateral movement across the network. This level of access enables them to deploy ransomware on a scale, maximizing the impact of their attack.

2. Exploiting centralized network access

Domain controllers handle crucial tasks like authenticating users and devices, managing user accounts and policies, and keeping the AD database consistent across the network. Because of these important roles, many devices need to interact with domain controllers regularly to ensure security, efficient resource management, and operational continuity. That’s why domain controllers need to be central in the network and accessible to many endpoints, making them a prime target for cyberattackers looking to cause maximum damage with ransomware attacks.

Given these factors, it’s no surprise that domain controllers are frequently at the center of ransomware operations. Cyberattackers consistently target them to gain privileged access, move laterally, and rapidly deploy ransomware across an environment. We’ve seen in more than 78% of human-operated cyberattacks, threat actors successfully breach a domain controller. Additionally, in more than 35% of cases, the primary spreader device—the system responsible for distributing ransomware at scale—is a domain controller, highlighting its crucial role in enabling widespread encryption and operational disruption.

Case study: Ransomware attack using a compromised domain controller

In one notable case, a small-medium manufacturer fell victim to a well-known, highly skilled threat actor, commonly identified as Storm-0300, attempting to execute a widespread ransomware attack:

Pre domain-compromise activity

After gaining initial access, presumably through leveraging the customer’s VPN infrastructure, and prior to obtaining domain admin privileges, the cyberattackers initiated a series of actions focused on mapping potential assets and escalating privileges. A wide, remote execution of secrets dump is detected on Microsoft Defender for Endpoint-onboarded devices and User 1 (domain user) is contained by attack disruption.

Post domain-compromise activity

Once securing domain admin (User 2) credentials, potentially through leveraging the victim’s non-onboarded estate, the attacker immediately attempts to connect to the victim’s domain controller (DC1) using Remote Desktop Protocol (RDP) from the cyberattacker’s controlled device. When gaining access to DC1, the cyberattacker leverages the device to perform the following set of actions:

• Reconnaissance—The cyberattacker leverages the domain controller’s wide network visibility and high privileges to map the network using different tools, focusing on servers and network shares.
• Defense evasion—Leveraging the domain controller’s native group policy functionality, the cyberattacker attempts to tamper with the victim’s antivirus by modifying security-related group policy settings.
• Persistence—The cyberattacker leverages the direct access to Active Directory, creating new domain users (User 3 and User 4) and adding them to the domain admin group, thus establishing a set of highly privileged users that would later on be used to execute the ransomware attack.

Encryption over the network

Once the cyberattacker takes control over a set of highly privileged users, this provides them access to any domain-joined resource, including comprehensive network access and visibility. It will also allow them to set up tools for the encryption phase of the cyberattack.

Assuming they’re able to validate a domain controller’s effectiveness, they begin by running the payload locally on the domain controller. Attack disruption detects the threat actor’s attempt to run the payload and contains User 2, User 3, and the cyberattacker-controlled device used to RDP to the domain controller.

After successfully containing Users 2 and 3, the cyberattacker proceeded to log in to the domain controller using User 4, who had not yet been utilized. After logging into the device, the cyberattacker attempted to encrypt numerous devices over the network from the domain controller, leveraging the access provided by User 4.

Attack disruption detects the initiation of encryption over the network and automatically granularly contains device DC1 and User 4, blocking the attempted remote encryption on all Microsoft Defender for Endpoint-onboarded and targeted devices.

Protecting your domain controllers

Given the central role of domain controllers in ransomware attacks, protecting them is critical to preventing large-scale damage. However, securing domain controllers is particularly challenging due to their fundamental role in network operations. Unlike other endpoints, domain controllers must remain highly accessible to authenticate users, enforce policies, and manage resources across the environment. This level of accessibility makes it difficult to apply traditional security measures without disrupting business continuity. Hence, security teams constantly face the complex challenge of striking the right balance between security and operational functionality.

To address this challenge, Defender for Endpoint introduced contain high value assets (HVA), an expansion of our contain device capability designed to automatically contain HVAs like domain controllers in a granular manner. This feature builds on Defender for Endpoint’s capability to classify device roles and criticality levels to deliver a custom, role-based containment policy, meaning that if a sensitive device, such a domain controller, is compromised, it is immediately contained in less than three minutes, preventing the cyberattacker from moving laterally and deploying ransomware, while at the same time maintaining the operational functionality of the device. The ability of the domain controller to distinguish between malicious and benign behavior helps keep essential authentication and directory services up and running. This approach provides rapid, automated cyberattack containment without sacrificing business continuity, allowing organizations to stay resilient against sophisticated human-operated cyberthreats.

Now your organization’s domain controllers can leverage automatic attack disruption as an extra line of defense against malicious actors trying to overtake high value assets and exert costly ransomware attacks.

Learn more

Explore these resources to stay updated on the latest automatic attack disruption capabilities:

• Learn more about Microsoft Defender for Endpoint.
• Read about the new containment features.
• Learn how attack disruption safeguards your domain controllers in this video.
• Check out our latest infographic.
• Read about automatic attack disruption.

To learn more about Microsoft Security solutions, visit our website. Bookmark the Security blog to keep up with our expert coverage on security matters. Also, follow us on LinkedIn (Microsoft Security) and X (@MSFTSecurity) for the latest news and updates on cybersecurity.

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¹Average cost per data breach in the United States 2006-2024, Ani Petrosyan. October 10, 2024.

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Source: Microsoft Security