US names China as top industrial espionage agent

03 November 2011 17:39  [Source: ICIS news]

US officially tags China as most aggressive economic spyWASHINGTON (ICIS)--The US intelligence community on Thursday officially named China and its government as the world’s “most active and persistent” industrial spies, responsible for an unprecedented onslaught of espionage that frequently targets US energy and petrochemical firms.

Although various unofficial reports have earlier identified China as a major offender in industrial espionage, and members of Congress have made similar charges, the report issued on Thursday by the top US counterintelligence agency marks the first time that the US government has officially named Beijing as the worst among hostile spies.

In a report that draws on data from 14 US intelligence and administrative agencies, the Office of the National Counter-Intelligence Executive (ONCIX) said that foreign industrial espionage against the US represents a “significant and growing threat to the nation’s prosperity and security”.

The report said that while dozens of countries conduct industrial and military espionage against the US – including some US allies – it is China that has been the most aggressive.

“Chinese actors are the world’s most active and persistent perpetrators of economic espionage,” the ONCIX report said.

US private sector firms and cybersecurity specialists have reported an onslaught of computer network intrusions that have originated in China, but the IC [intelligence community] cannot confirm who was responsible,” the report said.

However, elsewhere in the 30-page unclassified version of the ONCIX report, the counter-intelligence office says that Chinese leaders and intelligence services are behind the broad espionage campaigns.

The report cited a February 2011 case in which an internet protocol (IP) address located in China stole data from “the computer systems of global oil, energy and petrochemical companies”.

Among specific cases identified in the report were two recent prosecutions involving Chinese nationals that had infiltrated US chemical companies, stole proprietary technical information and were transferring the data to China when apprehended.

Although Russia also was identified as a major player among foreign industrial spy agencies or actors, the report clearly focused on Beijing as the chief perpetrator.

ONCIX noted that among the seven cases of foreign espionage prosecuted by the US in fiscal year 2010, six were linked to China.

The counter-spy agency report outlines areas where the US intelligence community and private companies are co-operating to confront the cyber espionage threat, and it identifies a series of counter-intelligence safeguards that companies can take.

The ONCIX does not make any policy recommendations for a US government response to what it says is “a growing and persistent threat to US economic security”.

However, this official intelligence community indictment of China as the most hostile espionage opponent of the US is likely to lead to further action by Congress, which is already considering various bills aimed at punishing the Beijing government.

Paul Hodges studies key influences shaping the chemical industry in Chemicals and the Economy

By: Joe Kamalick
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