Why the U.S. Is Charging China With Cyberspying on American Companies

Cyberspying is estimated to cost the U.S. economy tens of billions a year. “Enough is enough,” Attorney General Eric Holder said Monday.

Attorney General Eric Holder speaks during a farewell ceremony in honor of outgoing Federal Bureau of Investigation (FBI) Director Robert Mueller at the Department of Justice on August 1, 2013.
National Journal
Dustin Volz
May 19, 2014, 6:53 a.m.

{{ BIZOBJ (video: 4956) }}

The United States is char­ging the Chinese mil­it­ary with hack­ing in­to the com­puters of Amer­ic­an com­pan­ies in or­der to gain valu­able trade secrets, mark­ing the first time the U.S. has brought a crim­in­al case against a for­eign gov­ern­ment for cy­ber­spy­ing.

At­tor­ney Gen­er­al Eric Hold­er an­nounced Monday an in­dict­ment of five of­ficers of China’s People’s Lib­er­a­tion Army for breaches against six Amer­ic­an com­pan­ies.The charges fol­low an in­vest­ig­a­tion by a fed­er­al grand jury in Pitt­s­burgh that con­cluded China’s mil­it­ary of­ficers con­spired to hack in­to the com­puters of West­ing­house Elec­tric, Al­coa, Al­legheny Tech­no­lo­gies, U.S. Steel, the United Steel­work­ers Uni­on, and Sol­ar­World.

“When a for­eign na­tion uses in­tel­li­gence re­sources and tools against an Amer­ic­an ex­ec­ut­ive or cor­por­a­tion to ob­tain trade secrets or sens­it­ive in­form­a­tion for the be­ne­fit of state-owned com­pan­ies, we must say ‘enough is enough,’ ” Hold­er said. “This ad­min­is­tra­tion will not tol­er­ate ac­tions by any na­tion that seeks to il­leg­ally sab­ot­aged Amer­ic­an com­pan­ies and un­der­mines their com­pet­i­tion in the op­er­a­tion of the free mar­ket.”

Hold­er ad­ded: “Our eco­nom­ic se­cur­ity and our abil­ity to com­pete fairly in the glob­al mar­ket­place are dir­ectly linked to our na­tion­al se­cur­ity.”¦ This case should serve as a wake-up call to the ser­i­ous­ness of the on­go­ing cy­ber­threat.”

The de­fend­ants named in the case are Wang Dong, Sun Kaili­ang, Wen Xinyu, Huang Zhenyu, and Gu Chun­hui. All are part of the same unit in the People’s Lib­er­a­tion Army. Each has been charged with 31 counts of com­puter and eco­nom­ic crimes.

Last year, the U.S. and China agreed to hold bi­lat­er­al dis­cus­sions on cy­ber­se­cur­ity and es­pi­on­age, after U.S. of­fi­cials is­sued a num­ber of warn­ings to China that its theft of ma­ter­i­al from Amer­ic­an com­pan­ies could dam­age re­la­tions.

China has typ­ic­ally denied such al­leg­a­tions.

The Na­tion­al Se­cur­ity Agency has re­ceived scru­tiny for try­ing to pres­sure China to re­strict its cyberes­pi­on­age op­er­a­tions while at­tempt­ing to set in­ter­na­tion­al stand­ards for cy­ber­con­flict. Leaks from Ed­ward Snowden, which have re­vealed U.S. spy­ing on Chinese com­pan­ies, have promp­ted in­ter­na­tion­al out­rage, as many na­tions say the U.S. gov­ern­ment is push­ing a double-stand­ard on cy­ber­spy­ing.

But the NSA has denied hack­ing in­to for­eign net­works in or­der to give do­mest­ic com­pan­ies any sort of com­pet­it­ive ad­vant­age.

“We do not use for­eign-in­tel­li­gence cap­ab­il­it­ies to steal the trade secrets of for­eign com­pan­ies on be­half of — or give in­tel­li­gence we col­lect to — U.S. com­pan­ies to en­hance their in­ter­na­tion­al com­pet­it­ive­ness or in­crease their bot­tom line,” NSA spokes­wo­man Vanee Vines told Na­tion­al Journ­al last month.

Com­mer­cial cy­ber­spy­ing is a grow­ing drain on the U.S. eco­nomy, es­tim­ated to cost $24 bil­lion to $120 bil­lion an­nu­ally.

What We're Following See More »
BACKING OUT ON BERNIE
Trump Won’t Debate Sanders After All
1 days ago
THE LATEST

Trump, in a statement: “Based on the fact that the Democratic nominating process is totally rigged and Crooked Hillary Clinton and Deborah Wasserman Schultz will not allow Bernie Sanders to win, and now that I am the presumptive Republican nominee, it seems inappropriate that I would debate the second place finisher. ... I will wait to debate the first place finisher in the Democratic Party, probably Crooked Hillary Clinton, or whoever it may be.”

AKNOWLEDGING THE INEVITABLE
UAW: Time to Unite Behind Hillary
2 days ago
THE DETAILS

"It's about time for unity," said UAW President Dennis Williams. "We're endorsing Hillary Clinton. She's gotten 3 million more votes than Bernie, a million more votes than Donald Trump. She's our nominee." He called Sanders "a great friend of the UAW" while saying Trump "does not support the economic security of UAW families." Some 28 percent of UAW members indicated their support for Trump in an internal survey.

Source:
AP KEEPING COUNT
Trump Clinches Enough Delegates for the Nomination
2 days ago
THE LATEST

"Donald Trump on Thursday reached the number of delegates needed to clinch the Republican nomination for president, completing an unlikely rise that has upended the political landscape and sets the stage for a bitter fall campaign. Trump was put over the top in the Associated Press delegate count by a small number of the party's unbound delegates who told the AP they would support him at the convention."

Source:
TRUMP FLOATED IDEA ON JIMMY KIMMEL’S SHOW
Trump/Sanders Debate Before California Primary?
2 days ago
THE LATEST
CAMPAIGNS INJECTED NEW AD MONEY
California: It’s Not Over Yet
2 days ago
THE LATEST

"Clinton and Bernie Sanders "are now devoting additional money to television advertising. A day after Sanders announced a new ad buy of less than $2 million in the state, Clinton announced her own television campaign. Ads featuring actor Morgan Freeman as well as labor leader and civil rights activist Dolores Huerta will air beginning on Fridayin Fresno, Sacramento, and Los Angeles media markets. Some ads will also target Latino voters and Asian American voters. The total value of the buy is about six figures according to the Clinton campaign." Meanwhile, a new poll shows Sanders within the margin of error, trailing Clinton 44%-46%.

Source:
×