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5 Chinese military officials under U.S. indictments for cyber espionage

May. 19, 2014 - 06:00AM   |  
By | AMBER CORRIN   |   Comments
AG Holder Announces Economic Cyber-Espionage Charg
U.S. Attorney General Eric Holder announces indictments against Chinese military hackers on cyber-espionage. (Alex Wong / Getty Images)

The United States has indicted five Chinese military officials accused of hacking U.S. networks and stealing information, a move that represents the first legal swipe against international cyber theft.

Accusations against the Chinese of infiltrating the networks of U.S. companies and government agencies is not new, but this specific indictment charges that Chinese cyber spies target U.S. power companies to steal trade secrets for economic benefit to China-based companies.

“In sum, the alleged hacking appears to have been conducted for no other reason than to advantage state-owned companies and other interests in China at the expense of businesses here in the United States,” U.S. Attorney General Eric Holder told a news conference at the Justice Department. “This is a tactic that the United States government categorically denounces.”

The energy sector is far from the only victim alleged to be the target of Chinese cyber espionage. Members of Congress have pegged the cost of intellectual property theft as high as $400 billion, and Gen. Keith Alexander, former National Security Agency director and commander of U.S. Cyber Command, famously called cyber theft “the greatest transfer of wealth in human history.”

The defense industrial base also is a well-known target of cyber espionage, particularly when it comes to the designs of weapons systems and aircraft. Some say the problem is deeply rooted, including in the cultures of the U.S. and China.

“We do the best we can to train [U.S. cyber professionals]…but they’re going up against Chinese military officers who were probably recruited out of high school and probably have a couple Ph.D.s at this point and who do nothing but cyber their entire careers,” Rep. Tammy Duckworth (D-Ill.) said May 6 at the C4ISR & Networks conference in Arlington, Va. “This is a daunting enemy we have to face up to.”

It’s an issue that goes well beyond schooling, Duckworth added.

“What you have, if you look at the case of the F-35, is a cooperation between the [Chinese] civilian business community and the official government that moves forward in lockstep. So you actually have situations where corporate espionage conducted by Chinese corporations to steal data and technology on the F-35 we’re developing in the U.S. is then immediately passed on to the Chinese government and we find it showing up in the sixth-generation fighter aircraft that the Chinese are building,” Duckworth said. “And they’ve come right out and said that six of the new improvements to that aircraft that they’ve built are actually from what they’ve gleaned through cyber warfare, that they stole from American companies. For them it’s not considered stealing…for them it’s considered competition.”

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Bonus video: See Tammy Duckworth’s discussion of cyber culture .

Back in the U.S., some Defense Department officials and cyber experts seemed to laud the Justice Department’s actions, including at the National Space Symposium in Colorado Springs, Colo., where Air Force Space Command CTO Bill Marion called the indictments “a very positive thing.” Others, however, cautioned that the impact of the indictments remains to be seen.

“It has to be a strong enough enforcement action and it needs to stick in order for it to be effective,” Tracy Gray, who works data protection issues with the law firm Holland & Hart, said at the symposium. “Putting it out there and not giving the strong enough message will make this likely fade away. It will depend on what happens now that the indictments have been issued.”

Defense News’ Aaron Mehta contributed to this report.

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