Toy Ghouls’ new toy: the GenieLocker ransomware

Introduction

The new GenieLocker ransomware family has been active since March 2026. It has been used in attacks against organizations in the Russian Federation, primarily in the manufacturing sector, and attributed to the Toy Ghouls group by open-source intelligence (link in Russian).

The Toy Ghouls, also known as Bearlyfy, Labubu and Laboo.boo, is a financially motivated extortion group, which previously relied on third-party encryption Trojans like RedAlert, LockBit, and Babuk. GenieLocker, apparently a custom design, upgrades their toolkit and reduces their reliance on third-party software. We discovered multiple samples of this Trojan in two variants: PE builds for Windows and ELF builds for Linux and ESXi.

Technical details

Modus operandi

We described typical TTPs and modus operandi of the Toy Ghouls threat actor in the previous post (link in Russian).

In this article, we aim to thoroughly describe the capabilities of Windows and Linux builds of the custom encryption Trojan GenieLocker. To give more context, we will also provide a brief overview of the attack that took place at the end of March 2026, where GenieLocker was deployed on the victim’s systems.

Initial Access

During the incident, the attackers first entered the environment through an OpenVPN connection originating from an external partner’s network. They likely exploited the trusted relationship with that partner and used stolen, yet still valid, credentials to connect.

Discovery and Credential Access

After breaching the target’s network, the attackers installed additional tools on the compromised hosts, including OpenSSH, socks5.exe, SoftPerfect Network Scanner, and Mimikatz. They employed SoftPerfect Network Scanner for discovery and used Mimikatz to dump credentials. Forensic analysis also shows that they accessed the KeePassXC password manager already installed on several compromised machines, likely attempting to extract the stored credentials from the KeePass databases.

Lateral Movement and Command and Control

Lateral movement was performed by using RDP to reach Windows machines and SSH for Linux servers. The widespread deployment of the encryption Trojan was conducted with the legitimate utilities PsExec and PAExec. Additionally, the attackers established a reverse SSH tunnel to communicate with their command‑and‑control server.

Impact

During the impact phase, the attackers encrypted files on the compromised Windows machines with the PE version of the GenieLocker ransomware. On the compromised Linux and ESXi servers, they stopped active virtual machines and encrypted their disks using the ELF version of GenieLocker.

The tactics, techniques, and procedures seen here match those documented in earlier attacks attributed to the Toy Ghouls group. As in those prior incidents, forensic analysis found no evidence of data exfiltration, which is typical behavior for this threat actor. Toy Ghouls have not employed a double‑extortion model and do not run a data‑leak website.

Encryption Trojan for Windows

The Windows version of GenieLocker (MD5: 5d62c1349b8981c396c9a23f4f8f053c) is primarily written in C, but compiled with the C++ libraries using Microsoft Visual C/C++. The malware incorporates several ransom‑related capabilities, including process termination, service shutdown, debugger evasion, and a sophisticated encryption routine. For its cryptographic operations, it relies on the open‑source libsodium library.

Aligned with the recent trend supported by our expertise, as observed in attacks of some other ransomware strains, GenieLocker doesn’t save the ransom notes on the victim’s system. The Trojan doesn’t contain any attackers’ contact info or negotiation addresses. Instead, the attackers will need to deliver the ransom demands and contacts manually during the attack. This approach may be an attempt by the GenieLocker developers to avoid proactive detection of the ransomware process being triggered by the creation of multiple readme files.

Arguments and launch

GenieLocker supports multiple arguments for configuring its behavior.

Argument	Description
First argument	“Secret” argument, hex string value
-p, –percent N	Percentage of file content to encrypt
-r, –recursive	Process directories recursively
-l, –log <filename>	Set path for log file
-h, –help	Show help message
Last argument	Path to encrypt

GenieLocker expects the first argument to be a hex string referred to in the malware code as the “secret argument”, which is required for the ransomware to start. Most likely, the purpose of this is to avoid execution on sandboxes and other automated analysis environments. Another reason may be to prevent unauthorized usage by other threat actors.

The secret argument is a hex value with a variable size that does not exceed 4096 bytes. This hex string value is converted to bytes and hashed with the SHA‑256 algorithm. The result is compared to a hardcoded value. If they match, the literal string session is appended to the secret value, and the whole string is hashed with BLAKE2b‑256, but the resulting hash is never used. This may be a part of a feature still in development.