02 November 2018

The 'relentless threat' of China's state-sponsored IP theft

Chinese intelligence conspired to steal sensitive commercial aviation and technological data and IP for years, alleges the US.

US Attorney Adam Braverman said, ‘state-sponsored hacking is a direct threat to our national security.  This action is yet another example of criminal efforts by the MSS to facilitate the theft of private data for China’s commercial gain.’ John Brown, FBI Special Agent in Charge of the San Diego Field Office, explained ‘the threat posed by Chinese government-sponsored hacking activity is real and relentless.’

Charges brought

Chinese intelligence officers and those working under their direction, which included hackers and co-opted company insiders, conducted or otherwise enabled repeated intrusions into private companies’ computer systems in the United States and abroad for over five years.  The conspirators’ ultimate goal was to steal, among other data, intellectual property and confidential business information, including information related to a turbofan engine used in commercial airliners. The charged intelligence officers, Zha Rong and Chai Meng, and other co-conspirators, worked for the Jiangsu Province Ministry of State Security (JSSD), headquartered in Nanjing, which is a provincial foreign intelligence arm of the People’s Republic of China’s Ministry of State Security (MSS). The MSS, and by extension the JSSD, is primarily responsible for domestic counter-intelligence, non-military foreign intelligence, and aspects of political and domestic security. From at least January 2010 to May 2015, JSSD intelligence officers and their team of hackers allegedly focused on the theft of technology underlying a turbofan engine used in US and European commercial airliners. 

Just the beginning

John C Demers, assistant attorney general for national security, explained ‘for the third time since only September, the National Security Division, with its US attorney partners, has brought charges against Chinese intelligence officers from the JSSD and those working at their direction and control for stealing American intellectual property.’ He added, ‘this is just the beginning.’ Mr Braverman said, ‘the concerted effort to steal, rather than simply purchase, commercially available products should offend every company that invests talent, energy, and shareholder money into the development of products.’ An indictment in the Southern District of California describes in detail how JSSD intelligence officers and hackers masterminded a series of intrusions in order to facilitate intrusions and steal non-public commercial and other data, using a range of techniques. The first alleged hack began no later January 8, 2010. The charges contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.