Category Archives: economic espionage

Warner, Rubio introduce bill to protect U.S. from supply chain security issues

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Two senators are trying to create a central government entity to deal with supply chain security and strategize over how to keep U.S. technologies safe from foreign theft in a bill introduced on Friday. The bill, from Sens. Marco Rubio, R-Fla. and Mark Warner, D-Va., seeks to create a White House Office of Critical Technologies and Security. The new entity would take the lead in strategizing and coordinating across agencies to “protect against state-sponsored technology theft and risks to critical supply chains.” The proposed bill comes as the government increases pressure on China for allegedly using its corporate presence and workers in the U.S. to steal intellectual property. The Justice Department in December unsealed indictments against two Chinese citizens for allegedly spying on dozens of U.S. companies and agencies by hacking managed service providers. The White House is also weighing a ban on American companies’ use of technology bought from […]

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As China tensions mount, U.S. officials outline efforts to combat economic espionage

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In congressional testimony Wednesday, U.S. officials described the vast scope of alleged Chinese theft of American intellectual property and outlined ongoing efforts to counter such threats amid a dispute with Beijing. From 2011 to 2018, more than 90 percent of Justice Department cases claiming economic espionage by a state or for its benefit involved China, Assistant Attorney General John Demers said at a Senate Judiciary Committee hearing. “The [Chinese] playbook is simple: rob, replicate, and replace,” Demers said, describing Beijing’s alleged efforts to build technology-rich companies through stolen American know-how. China is “the most severe counterintelligence threat facing our country today,” said Bill Priestap, assistant director of the FBI’s Counterintelligence Division. The hearing comes at a fraught time for U.S.-China relations on technology, trade, and cybersecurity issues. Secretary of State Mike Pompeo alleged during an interview Wednesday with Fox News that China is responsible for a data breach at Marriott that exposed personal […]

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Chinese economic espionage is target of new Justice Department initiative

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Department of Justice officials say alleged Chinese economic espionage is “increasingly rapidly,” and they have established a high-level initiative dedicated to countering what they call a pervasive threat to U.S. national security. Led by Assistant Attorney General John Demers and staffed by senior DOJ officials, the new initiative will work to counter various forms of Chinese economic espionage, including the targeting of U.S. centers of ingenuity like universities, Attorney General Jeff Sessions said Thursday. The effort could lead the department to make recommendations to Congress for legislation to address the threat, he added. “Chinese economic espionage against the United States has been increasing and it has been increasing rapidly,” Sessions said at a press conference. “We are here today to say, ‘Enough is enough.’ We’re not going to take it anymore.” The Chinese government, Sessions said, was “notorious around the world” for intellectual property theft. Beijing has denied such allegations. The new DOJ […]

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DOJ indictment spotlights China’s civilian intel agency – and its hacker recruits

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In unsealing charges Tuesday against 10 Chinese nationals, the Department of Justice showed its focus is on China’s civilian intelligence agency, which analysts say has become Beijing’s preferred arm for conducting economic espionage. The agency, the Ministry of State Security, is more professional and technical in its hacking operations than China’s People Liberation Army, according to CrowdStrike co-founder Dmitri Alperovitch. “We have seen [the MSS], over the years, break into [corporate] organizations,” Alperovitch said Tuesday at an event hosted by The New York Times. “They were always better technically than the PLA.” After a landmark 2015 agreement between the United States and China not to steal intellectual property, Chinese activity in that vein tapered off for about a year, according to Alperovitch. Now, he said, it is back in full force. “[W]e’re seeing, on a weekly basis, intrusions into U.S. and other Western companies from Chinese actors,” with the MSS […]

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DOJ unseals charges against 10 Chinese nationals for hacking aerospace companies

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The Department of Justice on Tuesday unsealed charges against 10 Chinese nationals, including intelligence officers and hackers, for a multi-year campaign to steal aerospace technology and other proprietary information from U.S. companies. Partly relying on a “team of hackers,” intelligence officers at a provincial arm of China’s Ministry of State Security (MSS) focused on stealing turbofan-engine technology used in European and U.S. commercial airliners, DOJ said in a statement. The alleged operation lasted from at least January 2010 to May 2015, the department said. The turbofan engine was a joint project between unnamed French aerospace manufacturer and a U.S.-based company, according to DOJ. The Chinese intelligence operation breached the networks of the French manufacturer, as well as those of companies based in Arizona, Massachusetts and Oregon, the department said. The indictment returned by a grand jury in the Southern District of California lays out the hackers’ alleged tradecraft in detail. “The hackers used a […]

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New research highlights Vietnamese group’s custom hacking tools

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Cybersecurity researchers have uncovered remote access tools, or backdoors, linked to an infamous Vietnamese hacking group with a history of targeting government organizations and intellectual-property-rich companies. Analysts with cybersecurity company Cylance say that while investigating a security incident last year, they found multiple custom backdoors used by the cyber-espionage outfit known as APT32 or OceanLotus Group. The hackers used command and control protocols that were tailored to their targets and that supported multiple network communication methods. “The overall design and development of these threats indicate they come from a well-funded development team,” research from Cylance published Wednesday states. “The OceanLotus Group uses an expansive amount of custom library code that can easily be repurposed for maximum effectiveness against their next target.” Tom Bonner, Cylance’s director of threat research, told CyberScoop that the “underlying code for the APT32 backdoors is highly modular,” meaning it can be repurposed by tweaking command and control protocols. APT32, […]

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High-ranking Chinese operative charged with economic espionage, theft of trade secrets

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The US is intensifying its push to repress Chinese espionage efforts. A high-level Chinese intelligence officer from China’s major spy agency, the Ministry of State Security (MSS), was arrested in Belgium in April on charges of economic espionage… Continue reading High-ranking Chinese operative charged with economic espionage, theft of trade secrets→

Chinese spy extradited to U.S. on economic espionage charges

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A Chinese intelligence official has been extradited to the United States to face charges of economic espionage, the Department of Justice announced Wednesday. Yanjun Xu, a Chinese Ministry of State Security (MSS) official, is accused of trying to steal trade secrets from multiple American aerospace and aviation companies. For more than four years, beginning in December 2013, Xu targeted leading aviation companies, including GE Aviation, according to DOJ. He paid experts working at these companies to travel to China “under the guise of asking them to deliver a university presentation,” the department said. Xu, who is also known as Zhang Hui or Qu Hui, was arrested in Belgium in April, and extradited to the United States on Tuesday, DOJ said. He will face trial in a federal court in Cincinnati. Analysts and U.S. officials say the Xu case is further evidence that, after an apparent lull following a 2015 U.S.-China agreement […]

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NSA official: Foreign hackers have ‘pummeled’ U.S. by stealing IP

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Hackers sponsored by foreign governments have chipped away at the United States’ global economic advantage through a steady campaign of intellectual property theft, according to a top National Security Agency official. “It pains me to see the core of how we’ve defined ourselves over the last century” – in terms of innovation and intellectual property – “be continuously pummeled by external nation-state and non-nation-state-sponsored malicious cyber activity,” NSA Deputy Director George Barnes said Tuesday at the Intelligence and National Security Summit (INSA) in National Harbor, Md. Rather than one, devastating cyberattack, Barnes said there has been a “slow drop” of “continual theft of intellectual property from our industries.” Former NSA director Keith Alexander has repeatedly called the theft of U.S. intellectual property “the greatest transfer of wealth in history.” In a New York Times op-ed last year, Alexander and Dennis Blair, a former Director of National Intelligence, said such theft costs the U.S. $600 billion per year. […]

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Economic cyber-espionage is here to stay, U.S. counterintelligence report says

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A new report from a U.S. counterintelligence agency details persistent efforts by China, Iran, and Russia to steal U.S. trade secrets, warns that those campaigns are here to stay and raises concerns about the software supply chain as a vector for economic espionage. China, Iran, and Russia are “three of the most capable and active cyber actors tied to economic espionage,” and they will “remain aggressive and capable collectors of sensitive U.S. economic information and technologies, particularly in cyberspace,” the report from the National Counterintelligence and Security Center (NCSC) states. Last year was a “watershed” year in public reporting of big software supply-chain operations, with seven incidents reported compared to just four between 2014 and 2016, according to the NCSC, which is part of the Office of the Director of National Intelligence (ODNI). The counterintelligence agency cites the seminal NotPetya attack, which U.S. officials blamed on Moscow, and the CCleaner backdoor, which […]

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