Chinese State-Sponsored Cyber Espionage Activity Supports Expansion of China's espionage operations on the United States have been growing stronger for years. Rachel Ziemba. Nicholas Eftimiades is a lecturer at Penn State University, Homeland Security Program. The PLA was involved in 61 such cases. Now, more than eight years since the climax of the Cold War, the threat of industrial and economic espionage has percolated once again to the forefront, and the tools of the intelligence collector . Practice Communications Security But China does not only steal corporate crown jewels like trade secrets: It targets a wide variety of information that can provide Chinese companies with commercial advantage. United States v. Franklin - Wikipedia These types of activities represent an assault against core American values in a bid to stifle legitimate and necessary debate about China. But China is investing billions of dollars in its own technological prowess and can draw on the expertise of millions of Chinese engineers and scientists who have studied at top universities globally. Those include going after terrorists and spies, including in cyberspace, countering foreign malign influence, enforcing our export controls and sanctions laws, and reviewing foreign investments in U.S. companies. Both options are priced the same. 1101 riveredge rd, connellsville, pa 15425; traditional espionage activity includes foreign government. For example, China and Chinese companies have repeatedly paid off corporate insiders at U.S. and western companies to simply walk out the door with high-value trade secrets. I would add that U.S. universities should also increase the scrutiny of their collaborative research projects with Chinese institutions and researchers to make sure that U.S. institutions are not inadvertently facilitating the transfer of proprietary and/or sensitive technology and expertise to China, while continuing to engage in legitimate and positive research collaborations. It is a pleasure to be joined by two distinguished co-panelists who will also speak about the threat and I will focus on the aspects of the threat that I am most familiar with: how China uses unconventional, economic espionage as a component part of a comprehensive strategy to promote Chinas own high-tech industries. Private companies (and individuals) are most likely to employ no or minimal tradecraft. collecting intelligence for a terrorist organization In closing, the work being done by the FBI is immeasurable; however, we cannot afford to be complacent. Along with our domestic and foreign partners, we are collecting and analyzing intelligence concerning the ongoing threat posed by foreign terrorist organizations and homegrown violent extremists. The third pillar of our approach is based on strong relationships with the private sector. Inside the U.S.-China Espionage War - The Atlantic Foreign intelligence Entities seldom use elicitation to extract information from people who have access to classified or sensitive information. Only 10% of Russian spy operations in Europe uncovered, says former MI6 The distribution of Chinese espionage cases worldwide illustrates the magnitude of CCP controlled businesses, research entities, and government organizations involved in espionage activities (see Figure 2). 19 This cycle generally involves five steps: tasking, collection, processing and evaluating, analysis and production, and feedback. There has also been a large rise in Section 337 investigations. These diverse threats underscore the complexity and breadth of the FBIs mission: to protect the American people and uphold the Constitution of the United States. Attempting to gain access, without need-to-know However, cases attributed to the Ministry of State Security show an astounding nine cases where case officers and recruited agents demonstrated no discernible tradecraft. traditional espionage activity includes foreign government Unusual interest in information outside the scope of assigned duties CCP embedded committees manage all actions within directly managed SOEs. The poor performance in oversight and case management is possibly due to the highly politicized nature (CCP management) of Chinese intelligence. Shannon Brandao on LinkedIn: New images show FBI analyzing Chinese spy It is seen by many who enter messaging apps and participate in social networks. State-owned enterprises are also engaged in espionage. The most persistent threats to the nation and to U.S. interests abroad are homegrown violent extremists (HVEs), domestic violent extremists, and foreign terrorist organizations (FTOs). Unexplained affluence Echoing other terrorist groups, ISIS has advocated for lone offender attacks in Western countries. For example, U.S. prosecutors have accused Chinese hackers of stealing cost and pricing information from a U.S. solar company, which was probably intended to help Chinese competitors develop their own pricing strategy. These foreign competitors deliberately target economic intelligence in advanced technologies and successful U.S. industries. A 2018 National Counterintelligence and Security Center (NCSC) report on foreign economic espionage in cyberspace stated that in addition to China, Russia and Iran were engaging in significant cyber-enabled economic espionage activities. Do not prove for information - nonchalantly ask questions about them. Our second option allows you to build your bundle and strategically select the content that pertains to your needs. FBI.gov is an official site of the U.S. Department of Justice. Removing markings. Broadly speaking, the government response can be divided into three parts: encouraging better defense; prosecuting spies; and increasing costs in an effort to punish and deter unconventional spying. These information objectives include systems, designs, components, radiation hardened chips, integrated circuits, software, manuals, precision optics, thermal imaging systems, production techniques, etc. Even putting aside general issues of individual privacy, from an espionage perspective this kind of data can be a gold-mine, especially when combined with other data that the Chinese have access to. Our nation continues to face a multitude of serious and evolving threats ranging from homegrown violent extremists (HVEs) to cyber criminals to hostile foreign intelligence services and operatives. Cyber espionage: Russian state-sponsored groups have been implicated in a range of cyber espionage activities against Ukraine, including stealing sensitive government and military data, intellectual property, and other confidential information. Foreign Intelligence Threats Traditional FIE Activity includes: Foreign Intelligence Entities operating Many of the government mobile espionage efforts examined had roots in campaigns designed to spy on targets of interest of some of the nations covered in this report for political purposes. The U.S. recently charged Chinese spies and companies with trying to steal trade secrets from the semiconductor industry, and charged a Chinese agent with collecting information on Chinese nationals working in the U.S. for possible recruitment by Chinas spy agencies. But the underlying statute itself still arguably fails to cover a range of information collection and influence activities that China and other nations carry out in the United States. Espionage, as that term is traditionally used, involves trained intelligence professionals The foreign intelligence threat to the United States is expanding, becoming more complex and less predictable. Distribution of Chinese Espionage Activities in the U.S. Chinas main espionage activities against the United States are focused on the illegal export of military and dual use technology. traditional espionage activity includes foreign government Russia and China have been identified as . The venues for prosecution show where the target company or organization was located (see Figure 3.) We take all potential threats to public and private sector systems seriously and will continue to investigate and hold accountable those who pose a threat in cyberspace. APT41 has been active since as early as 2012. The Committee on Foreign Investment in the U.S. (CFIUS), an Executive Branch committee chaired by the Department of Treasury, was statutorily created to address potential risks to U.S. national security resulting from foreign acquisitions or mergers with U.S. companies. Economic Espionage Act of. There is a near equal distribution of espionage activities between the four major organizational clusters. APT41 is a group that carries out Chinese state-sponsored espionage activity in addition to financially motivated activity. Asia, Southeast I will focus my remarks on two aspects of Chinas unconventional espionage threat. Composed of subject matter experts from both the Criminal Investigative and Counterterrorism Divisions, the fusion cell offers program coordination from FBI Headquarters, helps ensure seamless information sharing across divisions, and augments investigative resources. Reportable International Terrorism Contacts, Activities, Indicators, and Behaviors include. The U.S. also needs to start getting a handle on the vast quantity of Americans personal information that is all too readily available to make sure that it cannot be exploited by spies. I'd the target takes the bait, the foreign intelligence officer recruits the target to move into a more clandestine relationship. China is stepping up anti-espionage activities amid worsening ties with the United States and a renewed focus on national security ahead of a key Communist Party anniversary later this year. , Statement Before the House Homeland Security Committee. The Espionage Act of 1917 is a United States federal law enacted on June 15, 1917, shortly after the United States entered World War I. Our adversaries are continuously trying to undermine our country, whether it is election season or not. A 2014 estimate by the Center for Responsible Trade and Enterprise (CREATe) and PriceWaterhouseCoopers argued that the cost of trade secret theft could amount to between 1 percent and 3 percent of GDP annually. Unexplained absences Regardless of the method or activity, Foreign Intelligence Entities seek one thing: to learn more about the Department of Defense plans in order to exploit its information and impede its mission. Through the Internet, terrorists anywhere overseas now have direct access to our local communities to target and recruit our citizens and spread their message faster than was imagined just a few years ago. Don't simply believe the the unexpected activity was coincidental New espionage offences - GOV.UK Figure 2: Chinese Organizational Clusters Committing Espionage. The International Trade Commission (ITC) has authority under Section 337 to investigate claims that an import uses stolen U.S. IP and to exclude infringing products, and has excluded a number of Chinese products in recent years. On the military side, the Peoples Liberation Army (PLA) General Staff Headquarters, Second Department is responsible for collecting military information, including related foreign technology. We also handle intelligence operations and oversight. Share sensitive information only on official, secure websites. Report, Trans-Pacific Therefore, when it comes to national security, it is vital that the men and women of our national intelligence community collect reliable domestic and foreign intelligence information involving criminal, clandestine and warlike activity. Money, Tokyo PDF Tudent Uide Dod Ci Awareness and Reporting Course for Dod - Usna The governing Chinese Communist Party (CCP) uses government, quasi-government, academic, and commercial entities as mechanisms to conduct all forms f espionage abroad. In another 22 cases, MSS operatives employed only simplistic or limited operational tradecraft. The IC remains focused on the missions of cyber intelligence . This Act is the National Security Legislation Amendment (Espionage and Foreign Interference) Act 2018. Enjoying this article? The FITF is also working with international partners to exchange intelligence and strategies for combating what is a shared threat. Subscribe How Silicon Valley Became a Den of Spies - POLITICO Magazine Store information in Secure Facilites Spies from 20 foreign intelligence agencies, including Nato allies such as France and Germany, are attempting to steal Britain's most sensitive secrets. Espionage makes it a crime to deal with information on behalf of, or to communicate to, a foreign principal (such as a foreign government or a person acting on their behalf). As former Cisco CEO John Chambers once said, There are two types of companies: those who have been hacked, and those who don't yet know they have been hacked.. Beginning under President Obama and continuing under President Trump, the Department of Homeland Security (DHS) has launched programs to encourage the private sector to harden defenses. PDF Privacy Impact Assessment - DHS An Ex-Trump Adviser's Acquittal Shows How Politics and Business International conventions, seminars, and exhibits Espionage and counterespionage have been essential tools of statecraft for centuries, of course, and U.S. and Chinese intelligence agencies have been battling one another for decades. China has aggressively targeted technologies central to its Made in China 2025 industrial strategy, a fact that should come as little surprise given the importance China attaches to the strategy. Introduction Fifth, I would encourage Congress to carefully study proposals to enable U.S. companies who are victims of Chinese economic espionage to hack back. There are significant concerns about hacking back proposals but I believe the concept merits careful study. In 2017 and 2018, suspected China-linked hackers have targeted U.S. firms operating in sectors including cloud computing, artificial intelligence, internet connected devices, biotechnology, energy, robotics, transportation, agricultural machinery and other agricultural technology, and high-end medical devices. The second major U.S. government response has been increasingly aggressive Justice Department efforts to prosecute Chinese spies. With Such Low Win Rates, Should Law Firms Respond to So Many RFPs? The FBI indictment alleges Ji was tasked by his spymaster a senior MSS officer in the Jiangsu Province MSS office. But if China proves willing to make systemic changes, the administration should be willing to relax the trade remedies the U.S. has imposed, rather than locking the U.S. into an economic cold war with Beijing. Second, Congress should study ways to expand prohibitions on the import into the U.S. of items made with stolen U.S. IP, and the Trump Administration should work with allies to keep such products out of foreign markets. Simultaneously, over the last year, propaganda from al Qaeda leaders seeks to inspire individuals to conduct their own attacks in the U.S. and the West. Chinese military sources can tell us exactly what the PLA is learning. Trust your instincts As the committee is well aware, the frequency and severity of malicious cyber activity on our nations private sector and government networks have increased dramatically in the past decade when measured by the amount of corporate data stolen or deleted, the volume of personally identifiable information compromised, or the remediation costs incurred by U.S. victims. Disgruntled employee attempting to gain access without need to know. Foreign intelligence services continue to employ more creative and more sophisticated methods to steal innovative technology, critical research and development data, and intellectual property, in an effort to erode Americas economic leading edge. We face threats from state-sponsored hackers, hackers for hire, organized cyber syndicates, and terrorists. The minimal application of tradecraft is expected, as these cases typically do not involve professional intelligence operatives (either case officers or agents). Nation States' Espionage and Counterespionage | CSO Online Us, Write The Espionage Act was amended in 1940 to increase the penalties it imposed, and again in 1970. Nation-State Cyber Espionage and its Impacts - Washington University in Former National Security Agency Director Keith Alexander has called Chinas IP theft greatest transfer of wealth in history. And as the 2018 NCSC report noted, the threat is growing due to expanded cloud-based computer networks and the internet of things (the home appliances, cars, and other things that will be connected to the internet)--which, according to the NCSC will create an incalculably larger exploitation space for cyber threat actors., Casual discussions of Chinese economic espionage often focus on high-end cyber intrusions into U.S. corporate networks. To combat the threat at home, the FBI established the Domestic Terrorism-Hate Crimes Fusion Cell in spring 2019. This Committee and the Congress as a whole should consider legislative reforms to expand the reach of FARA or to adopt other disclosure legislation that would ensure that Chinese activities related to universities and other non-profits are fully subject to public disclosure requirements. Al Qaeda maintains its desire for large-scale, spectacular attacks. Sanctions are more of a marathon than a sprint, and the long-term picture looks much more promising than the short-term one. By This report presents initial findings from analysis of 274 documented cases of Chinese worldwide espionage since the year 2000. The FBI is working closely with partners in the Intelligence Community and in the federal government, as well as with state and local partners, to establish a common operating picture. traditional espionage activity includes foreign governmentbuddy foster now. Email Email. But universities risk being fertile place for this kind of espionage, given the open, international, and collaborative nature of most university research and universities legitimate interest in encouraging international collaboration. An analysis ofoperational activities reveals a wide range of tradecraft practices (see Figure 5): As illustrated, the most frequently employed elements of tradecraft include using false names or documents to ship information or technology. With the broad distribution of social media, terrorists can spot, assess, recruit, and radicalize vulnerable persons of all ages in the U.S. either to travel to foreign lands or to conduct an attack on the homeland. Foreign espionage strikes at the heart of U.S. national security, impacting political, military and economic arenas. They seek to hold our critical infrastructure at risk, to harm our economy and to constrain our free speech. The Trump administration should use CFIUS to block Chinese companies that have stolen U.S. technology from acquiring companies in the United States. Espionage Definition & Meaning - Merriam-Webster In this Nov. 9, 2017, file photo, an American flag is flown next to the Chinese national emblem during a welcome ceremony for visiting U.S. President Donald Trump. The first line of response has been to encourage companies to harden their networks against cyber intrusions and to bolster defenses against other types IP theft, such as by corporate insiders. Over the last year, the FBI has met with top social media and technology companies several times, provided them with classified briefings, and shared specific threat indicators and account information, so they can better monitor their own platforms. Persons subject to the UCMJ may be subject to punitive action High-level findings are as follows: One cannot simply look at a single or even several espionage cases and hope to understand if, and how, a nation state is conducting espionage. Members of the Committee may have seen recent press reports about marketing firms and hedge funds buying cell phone location data showing the near-real time locations of tens of millions of Americans going about their daily routines. Information gathered and activities conducted to identify, deceive, exploit, disrupt, or protect against espionage, other intelligence activities, sabotage, or assassinations conducted for or on behalf of foreign powers, organizations or persons or their agents or international terrorist organizations. This represents a new and different threat to Americas long-term leadership and must be addressed forcefully. Hacking back proposals would need to be carefully tailored to mitigate potential unintended consequences and to protect innocent parties, and the risks need to be carefully evaluated. The Committee looks . How Congress can confront the growing Chinese espionage threat Do not leave equipment unattended, in hotel safes or left in vehicles. The only notable area in which China has shown minimal advancement has been in applying sophisticated espionage tradecraft. It has not been as easy for the United States to gain buy-in as some in Washington expected. Figure 3: Distribution of Chinese Espionage Cases in the United States. The two use similar language to talk about China, but that doesn't mean their positions are the same. Chinese entities conducting espionage include government agencies, the military, state- owned enterprises (SOEs), private companies/individuals, and select universities. Evoke or draw out (a response, answer, or fact) from someone in reaction to ones own actions or questions. The third major line of response has been to increase costs to China over its espionage program and to take action against specific Chinese companies that engage in and/or profit from unconventional espionage. Counterintelligence FBI - Federal Bureau of Investigation When in doubt, report it, See something say something These techniques were used approximately one-third of the time. The distribution pattern shows activity concentrations occurring in high-tech sectors, manufacturing hubs, and business centers. The Department of Justice has in recent years indicted numerous Chinese spies, hackers, and companies for their involvement in stealing U.S. IP. Intelligence & Espionage. Copying files, unexplained absences, terminating employment, Counterintelligence Awareness & Reporting Cou, CI Awareness and Reporting Briefing Assessment, Counterintelligence Awareness and Reporting f, Level I Antiterrorism Awareness (JS-US007), J3OP-US261-HB Emergency Preparedness Response, TEMA 28: Bacterias de interes biotecnologic. Annual Report to Congress on Foreign Collection and Industrial Chinese economic espionage, on the other hand, is an unconventional threat and requires an unconventional response. The Obama administration issued two Executive Orders, E.O. Intelligence and Espionage in the 21st Century Unreported contact with foreign nationals Second, we are focused on information and intelligence-sharing. Keeping pace with these threats is a significant challenge for the FBI. These activities support a national concerted effort to expand Chinas economic and security interests. An eye-witness report by two investigative journalists on the ground in Prato, Italy. In recent years we have broadly seen two types of Chinese espionage targeting U.S. colleges and universities. II. The goal of cyber espionage, which may also be referred to as cyber spying, is to provide the attacker with information that gives them advantages over competing companies or governments. The U.S. government has steadily increased its response to the threat of China's unconventional espionage. According to the New York Times, Congress received an intelligence report last month that underscored at . In 2016 broad bipartisan majorities of Congress passed the Defend Trade Secrets Act, which expanded the rights of U.S. companies to sue Chinese firms and other foreign competitors that steal their IP. The US government has taken a range of measures to counter Chinese espionage and protect American interests. The initiative will prioritize cases of Chinese economic espionage and ensure that they are appropriately resourced. Figure 6: Espionage Tradecraft Techniques by Specific PRC Entities. DHS is also investing in research into technologies and public-private partnerships that may be able to improve cybersecurity practices and in education and outreach programs designed to improve corporate cybersecurity practices. As the threat to harm the United States and U.S. interests evolves, we must adapt and confront these challenges, relying heavily on the strength of our federal, state, local, and international partnerships. The CCPs Organization Department makes all senior personnel appointments within these business organizations. Women, Influence & Power in Law UK Awards 2023, Legalweek Leaders in Tech Law Awards 2023, WORKERS COMPENSATION ATTORNEY - Hartford, CT, Offering an Opportunity of a Lifetime for Personal Injury Lawyers, What Does Your Business Agreement Really Mean? The Director of National Intelligence report, Foreign Economic Espionage in Cyberspace (2018) identifies key industries and technologies that are frequent targets of foreign espionage. A number of countries have mounted aggressive economic espionage campaigns here that vacuum up advanced United States In approximately 60 cases I reviewed, Chinese companies or individuals were acting unilaterally for commercial benefit only. Nations have been spying on the United States (and us on them) since the American Revolution. No Thanks An unprecedented, sustained, and multi-pronged campaign of activity that does not constitute traditional military force or espionage threatens to exert a stealthy and non-attributable influence upon American attitudes toward international affairs at a moment of global crisis. U.S. Trade Representative Lighthizer and President Trump need to demand major, systematic changes in a range of Chinese trade abuses before relenting on the tariffs and other measures the U.S. has imposed. Updated Foreign Assistance Standardized Program Structure and In addition to beaming out its perspectives via Chinese state media, Beijing is aspiring to control both the structure and norms of global information networks. The recent attacks in Texas and California underscore the continued threat posed by domestic violent extremists and perpetrators of hate crimes. The charges included acting as an agent of a foreign government without notifying the attorney general, a charge the Justice Department has referred to as "espionage lite," a violation of . Virtually every national security threat and crime problem the FBI faces is cyber-based or facilitated. Southeast I appreciate your continued support and look forward to answering any questions you might have. There is a wide variance in what the media, public, and U.S. legal codes define as espionage. Four U.S. statutes and administrative regulations encompass those definitions: For the purposes of this study, all the aforementioned legal definitions of criminal acts are categorized as espionage. This espionage definition considers media and common public usage, and similarities in the acts, i.e. Advocating support for terrorist organizations Economic espionage, which is mainly conducted by private companies or individuals, makes up 23.5 percent of cases. These can number in the thousands and reflect the organizations knowledge gaps. And the U.S. would need to take the Ronald Reagan line towards Soviet military commitments when it comes to Chinese concessions, Trust, but verifywith an emphasis on the verify. But we should not foreclose the possibility of cooperation.
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