Flame is a new recent malware spreading wide across. It is found that it exploits the Microsoft's digital certifcate to infect the target. It initiates a kind of "Man-in-the-middle" attack!
When a machine tries to connect to Microsoft’s Windows Update, it redirects the connection through an infected machine and it sends a fake, malicious Windows Update to the client.
In the process of infecting a client, 8 CAB files are used. One of them contains a specifically built program called WuSetupV.exe:
This program (also detected as Worm.Win32.Flame.a), which is 28KB in size, has been signed by a fake Microsoft certificate:
This allows it to run in the victim’s machine without any warnings.
The Flame “Gadget” downloader was compiled on December 27th, 2010. It was signed on December 28 and it was finally put into the CAB archive on Jan 11, 2011.
The following is exactly how the process occurs: the infected machine sets up a fake server by the name “MSHOME-F3BE293C”, which hosts a script that serves a full body of the Flame malware to victim machines. This is done by the module called “Munch”. When a victim updates itself via Windows Update, the query is intercepted and the fake update is pushed. The fake update proceeds to download the main body and infect the computer.
Important information: One June 4th, 2012, Microsoft released a number of blog posts and an Update for Windows which is blocking three fraudulent certificates used by Flame.
Microsoft security advisory 2718704:http://technet.microsoft.com/en-us/security/advisory/2718704