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article imageU.S. charges Chinese military with cyber-spying — Reports

By AFP     May 19, 2014 in World

The United States has filed charges against several members of China's military for allegedly stealing American trade secrets, media reports said Monday.

The Washington Post and other news outlets said that the Justice Department is charging members of China's People's Liberation Army in the first U.S. prosecution of foreign state actors over economic espionage.

The move marks an escalation in an intense dispute between the world's two largest economies over hacking, with the United States moving beyond rhetoric in pressuring China.

The Justice Department said only that Attorney General Eric Holder would announce an indictment "in a national security case" at 10:00 am (1400 GMT).

Hacking has emerged as a major irritant in the already complicated relationship between China and the United States, with President Barack Obama raising concerns directly with his counterpart Xi Jinping.

A participants connects his computer to compete in the ethical hacking contest Insomni'hack 201...
A participants connects his computer to compete in the ethical hacking contest Insomni'hack 2014 on March 21, 2014 in Geneva
Fabrice Coffrini, AFP/File

In a report in February last year, the security firm Mandiant said that China has made a major investment in cyber-espionage and set up a military-linked unit with thousands of workers who pilfer intellectual property and government secrets overseas.

The workers operate from a non-descript, 12-story building on the outskirts of Shanghai and had stolen data from at least 141 organizations spanning 20 industries, the 2013 study said.

The report said that the hacking group known as APT1 -- which stands for "Advanced Persistent Threat" -- was believed to be a branch of what is known as Unit 61398 of the People's Liberation Army.

A separate report led by former U.S. officials estimated last year that hacking was costing the U.S. economy more than $300 billion each year -- equivalent to what the United States sells each year to Asia.

China was by far the biggest culprit, although other countries including Russia also have hacked U.S. intellectual property, it said.

US President Barack Obama (R) shakes hands with Chinese President Xi Jinping as they pose for a fami...
US President Barack Obama (R) shakes hands with Chinese President Xi Jinping as they pose for a family picture with other world leaders, in The Hague on March 25, 2014
Robin Van Lonkhijsen, POOL/AFP/File

Beijing has hit back that Washington is hypocritical as it conducts widespread surveillance around the world, as revealed by former government contractor Edward Snowden.

Snowden's leaks have indicated that the United States has hacked into Chinese telecom giant Huawei -- whose own attempts to penetrate the U.S. market have been blocked by lawmakers' concerns on national security.

The United States has invested heavily in cyber-warfare, with the Pentagon setting up a dedicated unit, and is widely suspected to have worked with Israel to infect Iran's nuclear program.

Defense Secretary Chuck Hagel, on a visit to Beijing last month, asked China to be more open about its cyber capabilities in hopes of reducing the chances of an inadvertent conflict.

The U.S.-China Economic and Security Review Commission, in its annual report released in November, had urged U.S. action to change the "cost-benefit calculus" for Beijing on hacking.

The commission, which has an advisory role to U.S. policymakers, called for Washington to consider a ban on import of certain products from China -- whose manufacturing sector is a major economic driver -- if they are determined to use technology stolen from the United States.

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