China and Russia are increasingly using cyber-espionage tactics to steal classified trade and technology information, according to a new U.S. intelligence report sent to Congress and released to the public on Thursday.
The report says Chinese and Russian intelligence agencies commonly use hackers to steal data. Chinese and Russian intelligence agents also hide behind proxy servers in other countries to collect sensitive high-tech data with little risk of being detected.
Because the United States is a leader in developing new technologies, the report stated bluntly, “Foreign attempts to collect U.S. technological and economic information will continue at a high level and will represent a growing and persistent threat to U.S. economic security.”
The “Foreign Spies Stealing U.S. Economic Secrets in Cyberspace” report from the Office of the National Counterintelligence Executive marks the first time the United States has publicly accused either China or Russia, or corporate hackers inside those countries, of stealing American trade secrets.
Naming Russia as a “distant second” to China, the report notes that the two are the “most aggressive collectors” of information technology, military technology, clean-energy technology, and medical technology belonging to U.S. agencies and firms.
Russian intelligence services are “conducting a range of activities to collect economic information and technology from U.S. targets,” the report said.
Chinese hackers are by far “the world’s most active and persistent perpetrators of economic espionage,” the report added. Numerous U.S. companies said they have received “an onslaught of computer network intrusions that have originated in China,” but cannot confirm exactly who is responsible for the attacks, it said.
In one example, Yu Xiangdong, an engineer with Ford Motor Company’s China branch, copied around 4,000 company documents onto an external hard drive in 2006 in an attempt to get a job with a Chinese car company, the report said. He pleaded guilty to theft of trade secrets and was sentenced in April.
With the economy still sluggish after several years and unemployment steadily over 9 percent, the United States is looking to use its technological innovations for growth. For years, U.S. officials and independent security experts have said China and Russia have been behind a growing number of cybertheft incidents.
“The computer networks of a broad array of U.S. government agencies, private companies, universities, and other institutions—all holding large volumes of sensitive economic information—were targeted by cyber-espionage,” it stated.
The report said that economic espionage could cost the U.S. economy as much as $400 billion per year, but noted the figure could be lower, citing differing methods of data collection and scarcity of information. It said the South Korean government reported an $82 billion loss from economic espionage in 2008.
Corporate, criminal, and independent entities in China and Russia have also stolen large amounts of trade, technology, and economic secrets from the U.S. government and American firms, according to the report. Such thefts are not necessarily linked to the countries’ intelligence agencies.
Some allies and partners of the United States are also complicit in cybertheft. They use their easy and “broad access” to American companies and agencies to take technology and economic data, the report said. Some have advanced capabilities.
Despite the release of the report, Moscow and Beijing will likely persist in deploying “significant resources and a wide array of tactics to acquire this information from U.S. sources, motivated by the desire to achieve economic, strategic, and military parity with the United States,” according to the report.