How North Korea's IT army is hacking the global job market

• Experts say reputational risk, legal uncertainty and embarrassment all contribute to the silence — which in turn makes the problem harder to solve.
• Dozens of resumes, LinkedIn profiles and fraudulent identity documents shared with Axios lay bare the scale and sophistication of the scams.

The big picture: For North Korea, this is a precious revenue stream that evades American sanctions — capitalizing on the wealth of high-paying remote worker roles in the U.S. to route cash back to Pyongyang.

• In the past two years, companies and their security partners have begun to grasp the scale of the problem. Now, they're sounding the alarm about where it's headed next.
• "They've been stealing intellectual property and then working on the projects themselves," Michael "Barni" Barnhart, principal investigator at DTEX Systems, told Axios. "They're going to use AI to magnify exponentially what they're already doing — and what they're doing now is bad."

Between the lines: It sounds easy to simply weed out North Korean job applicants. But some of the world's biggest firms have found it devilishly difficult.

• That's because the North Korean operation has become as complex as a multinational corporation. It involves several North Korean government offices, dozens of China-based front companies and Americans willing to facilitate the fraud.
• And the undercover North Korean IT workers are often exceptional at their jobs — at least until they start stealing sensitive data or extorting companies that try to fire them.
• Google Threat Intelligence VP Sandra Joyce recalled the response of one employer when told they likely had a North Korean fraudster on staff: "You guys better be right, because that is my best guy."

The groups running the show

North Korea has invested years into building up its remote IT labor force, providing training not just for remote job fraud but also corporate espionage and IP theft.

• Workers are selected and trained at elite institutions such as Kim Chaek University of Technology and the University of Sciences in Pyongyang — some with specializations in software development, AI or cryptography.

• Research from DTEX shows that the most advanced worker scams are often coordinated with units like APT 45, a notorious government hacking group known for infiltrating companies, running scams and laundering money.
• Other participants in the scheme include the Lazarus Group, which typically leads the regime's cryptocurrency hacks and has positioned insiders within crypto companies, and Research Center 227, a new AI research unit inside North Korea's intelligence agency.

The intrigue: Cybersecurity companies have been discovering and naming new groups running these hacks, with names like Jasper Sleet, Moonstone Sleet and Famous Chollima.

The scale

Driving the news: Nine security officials who spoke with Axios all said they've yet to meet a Fortune 500 company that hasn't inadvertently hired a North Korean IT worker.

• Google told reporters at the RSA Conference in May that it had seen North Koreans applying to its jobs. SentinelOne and others have said the same.
• KnowBe4, a cybersecurity training company, admitted last year that it hired a North Korean IT worker. A smaller cryptocurrency startup told the WSJ that it accidentally had North Korean workers on its payroll for almost two years.

In one case, Sam Rubin, senior vice president of Palo Alto Networks' Unit 42 consulting and threat intelligence team, told Axios that within 12 hours of a large client posting a new job, more than 90% of the applicants were suspected to be North Korean workers.

• "If you hire contract IT workers, this has probably happened to you," Rubin said.

The intrigue: Even small-to-mid-sized companies that rely on remote IT talent or outsource their IT needs to a consulting firm have encountered this problem, Adam Meyers, senior vice president of counter adversary operations at CrowdStrike, said.

• CrowdStrike has investigated more than 320 incidents where North Korean operatives landed jobs as remote software developers, according to the company's annual threat hunting report published earlier this month.

How it works

Getting a job at a U.S. company — and going undetected — is a team effort that involves several North Korean IT workers, China-based companies and even a handful of Americans.

• Some of the North Korean workers are even stationed in China and other nearby countries to keep suspicions low.

First, the workers identify potential identities they can assume. Those are often stolen from a real person, or even from a dead U.S. citizen.

• To pull off this deception, they create fake passwords, Social Security cards and utility bills. Many of them use the same recognizable tablecloth in the background of fake ID photos, Meyers said.
• For instance, in a December indictment of 14 North Koreans, the workers were found using stolen identities to apply to dozens of jobs.

Second, the workers find open jobs in software development, technical support and DevOps posted on Upwork, Fiverr, LinkedIn and third-party staffing platforms. Much of this is streamlined through AI tools that help track and manage their job applications.

• Many of them will use AI tools to help generate passable resumes and LinkedIn profiles, according to Trevor Hilligoss, senior vice president at SpyCloud Labs.
• "There's a hierarchy. There's a group of people who are the interviewers, and they're the ones with the really good English specialties," Hilligoss told Axios. "When they get hired, that gets turned over to somebody that's a developer."
• Those developers will often juggle several jobs and multiple different personas.

Zoom in: Job interviews would seem like the obvious time to catch a fraudulent application. But the "applicants" — whether they're using their real faces and voices or AI-enabled personas — are practiced interviewers with the skills necessary to complete technical coding assignments.

• In multiple cases, hiring managers only realized something was wrong weeks later when employees looked or behaved differently than during the interview, Barnhart said.

After landing the job, the developers step in and request that their company laptop be shipped to a U.S. address — often citing a last-minute move or family emergency. That address often belongs to an American accomplice, who typically operates what's known as a "laptop farm."

• These facilitators are told to install specific remote desktop software onto the laptops so the North Korean worker can operate the laptop from abroad.
• In July, the FBI said it executed searchers of 21 premises across 14 states that were known or suspected laptop farms, seizing 137 laptops.

Then there's the challenge of ensuring the salaries actually reach the North Korean regime.

• That often requires the facilitators forward the paychecks to front companies across China or funnel it through cryptocurrency exchanges.
• In a report published in May, researchers at Strider Technologies identified 35 China-based companies linked to helping North Korean operations.

Challenges

Hiring processes are so siloed that it's difficult for managers to see all the signs of fraud until the North Korean workers start their roles, said Sarah Kern, a leading North Korea analyst at Sophos' Counter Threat Unit.

• Even if a company suspects something is wrong, the forensic signals can be subtle and scattered. Security teams may detect unusual remote access tools or strange browser behavior. HR might notice recycled references or resumes that reuse the same phone number.
• But unless those insights are pooled together, it rarely raises alarms.
• "There's not one giant red flag to point to," said Kern. "It is multiple technical forensic aspects and then such a human aspect of small things to pick up on that aren't necessarily going to be in telemetry data from an endpoint detection standpoint."

Yes, but: Even when these workers are detected, they're not easy to fire. Many of them are so talented that managers are reluctant to even believe they could actually be in North Korea, Alexandra Rose, director at Sophos' Counter Threat Unit, told Axios.

If these workers are caught, employers then face a litany of problems. Some workers will download sensitive internal data and extort the companies for a hefty sum in a last-ditch effort to bleed the company of whatever money they can.

• Some workers have filed legal complaints, including workers' compensation claims, Barnhart said. In one case, Barnhart said he had a worker try to claim domestic violence protections as they were being fired just to buy time.
• "There is a lot of focus on companies that cybersecurity shouldn't just be for the CISO," Rose said. "You want a bit of that security feel throughout the company, and this is the kind of case that really demonstrates why that is."

The bottom line: Some companies also hesitate to report these incidents, fearing they could be penalized for unknowingly violating U.S. sanctions — even though law enforcement officials have said they're more interested in cooperation than prosecution.

What's next

Right now, the operations are predominantly focused on making money for North Korea's regime.

Threat level: But the hacking groups involved are evolving into something more sophisticated and dangerous — including by potentially building their own AI models and feeding in sensitive U.S. company data.

• That's a particular concern in the defense sector. Barnhart says his teams have seen North Korean IT workers increasingly studying information about AI technologies, drone manufacturing and other defense contract work.

What to watch: As U.S. companies become more alert, North Korean IT workers are shifting their focus abroad as they seek employment at other companies and set up laptop farms throughout Europe — suggesting the operation is only just now ramping up, instead of slowing down.

• "We are starting to see it in Europe, too — they're in Poland, they're in Romania, they're in the U.K.," CrowdStrike's Meyers said. "They're expanding everywhere."