Microsoft Warns Storm-0501 Shifts to Cloud-Based Encryption, Data Theft, and Extortion

Microsoft has issued a warning about Storm-0501, a threat actor that has significantly evolved its tactics, moving away from traditional ransomware encryption on devices to targeting cloud environments for data theft, extortion, and cloud-based encryption. Instead of relying on conventional ransomware payloads, the group now abuses native cloud features to exfiltrate information, delete backups, and cripple storage systems, applying pressure on victims to pay without deploying malware in the traditional sense. 

Storm-0501 has been active since at least 2021, when it first used the Sabbath ransomware in attacks on organizations across multiple industries. Over time, it adopted ransomware-as-a-service (RaaS) tools, deploying encryptors from groups such as Hive, BlackCat (ALPHV), Hunters International, LockBit, and most recently, Embargo ransomware. In September 2024, Microsoft revealed that the group was expanding into hybrid cloud environments, compromising Active Directory and pivoting into Entra ID tenants. During those intrusions, attackers established persistence with malicious federated domains or encrypted on-premises devices with ransomware like Embargo. 

In its latest report, Microsoft highlights that Storm-0501 is now conducting attacks entirely in the cloud. Unlike conventional ransomware campaigns that spread malware across endpoints and then negotiate for decryption, the new approach leverages cloud-native tools to quickly exfiltrate large volumes of data, wipe storage backups, and encrypt files within the

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