China the main economic espionage threat to US: FBI

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Washington | Published: July 26, 2015 7:35:11 PM

The US has witnessed a 53 per cent spike in economic espionage cases aimed at American firms, with a vast majority of the perpetrators originating from China with ties to the government, the FBI said".

The US has witnessed a 53 per cent spike in economic espionage cases aimed at American firms, with a vast majority of the perpetrators originating from China with ties to the government, the FBI said.

The head of the Federal Bureau of Investigation’s counterintelligence division, Randall Coleman, said there has been a 53 per cent increase in economic espionage cases, or the theft of trade secrets leading to the loss of hundreds of billions of dollars, over the past year.

Coleman said at a recent briefing that state-sanctioned corporate theft by China is at the core of the problem.

Coleman said that China is the most predominant threat facing the US from the standpoint of economic espionage.

He cited examples of large corporations successfully targeted in the past such as DuPont, Lockheed Martin and Valspar, who have since worked with the FBI to further safeguard their intellectual property.

To highlight this growing threat to the US economy, the FBI has launched a nationwide campaign intended to warn industry leaders of the danger they face from foreign actors. But the FBI not only considers this a threat to American economic prosperity, but to its physical security as well.

“Economic security is national security,” said Bill Evanina, the head of the National Counterintelligence and Security Center and one of the agents leading the charge in stemming the threat to corporations. Many of the tools used are the same as the ones used to track terrorists, he said.

Half of the 165 private companies that participated in a survey conducted by the FBI have claimed to be victims of economic espionage or theft of trade secrets, and 95 per cent of those attempts originated from individuals associated with the Chinese government, CNN reported.

One of the most concerning means of obtaining sensitive industry secrets is through the use of “insider threats,” or employees who are familiar with the inner workings of a particular technology being recruited by foreign agents in exchange for large amounts of cash.

The FBI continues to see spear phishing attempts, when an email or link appears legitimate but is in fact a bogus message intended on tricking recipients into offering up personal information. Social media and sites like LinkedIn are also being utilised in economic espionage where potential recruits can be found and contacted based on relevant knowledge and work experience, officials said.

“The Chinese government plays a significant role” in economic espionage, Evanina said. “The playing field is not level” when a single company faced with relentless targeting by individuals or entities who have the backing of a foreign government, he said.

Other big targets for economic spies are specifications for US military technology and proprietary information on everything from superconductors to seed-and-grain hybrids.

“It’s across the board,” said Dean Chappell, a section chief in the FBI’s counterintelligence division. “It’s not high-end avionics for military aircraft; it’s not joint strike fighter stuff. It’s all of the things that we see every day.”

In a change from more traditional modes of economic espionage, such spies are appearing as non-traditional actors, serving as insider threats within organisations and institutions, officials say.

William Evanina, head of the National Counterintelligence and Security Center, said such individuals have been observed in the US serving as professors, engineers, travelling students and businessmen.

Officials also warn of cyber tactics used to hijack intellectual property and trade secrets.

In particular, actors, predominantly from China, are known to employ mass spear-phishing campaigns to coax employees inside companies into clicking tainted links or attachments, Fox News reported.

If successful, the actor could get critical data off of the organisation’s computer network.

China in particular has been publicly outed on multiple occasions by the Obama administration for its efforts geared toward breaching private sector interest.

US economists blame China for contributing to an increasingly uneven playing field on the world economic scene.

“To sustain its phenomenal growth rate, China must employ cyberattacks to steal information,” said Scott Borg, director and chief economist of US Cyber Consequences Unit, a non- profit research institute.

“Cyberattacks stealing competitively important business information are a fundamental part of the national economic development strategy of China. For this reason, getting China to moderate this behaviour will be extremely difficult,” Borg said.

As a result, The FBI has announced a nationwide awareness campaign and continues to develop relationships within U.S. industry.

The agency has provided over 1,300 in-person briefings on the economic espionage threat to companies and industry leaders over the past year, using a FBI-produced video entitled ‘The Company Man: Protecting America’s Secrets’, as a training tool.

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