News you may have missed #880

Augusto PinochetBy IAN ALLEN | intelNews.org
►►Chinese military establishes cyberintelligence research center. The Chinese People’s Liberation Army (PLA) has announced the creation of a Cyberspace Strategic Intelligence Research Center. Experts say the Center will “provide support in obtaining high-quality intelligence research findings and help China gain advantage in national information security”. Its staff reportedly specialize in such fields as strategic theory research, intelligence studies, and technology management, among others.
►►Chile court says US had role in 1973 killings of Americans. A court ruling released late Monday said the commander of the US Military Mission in Chile at the time of the 1973 military coup gave information to Chilean officials about journalist Charles Horman and student Frank Teruggi that led to their arrest and execution just days after the coup, which brought General Augusto Pinochet to power. The case remained practically ignored in Chile until 2000, when Horman’s widow, Joyce, came and filed a lawsuit against Pinochet.
►►Opinion: Cyber tools are no substitute for human intelligence. A colonel in the Israel Defense Forces critiques “the increasing use of cyber tools as a central and sometimes exclusive role in the work of many intelligence agencies throughout the world”. He argues that “the documents exposed by Edward Snowden show how willing the Americans are to invest in technological systems to collect information and gather as much intelligence as they can using cyber tools”. But he warns that “this almost exclusive reliance on the collection and analysis of intelligence using technology comes at the expense of the human element as a basic component of intelligence-gathering”.

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Analysis: Should government spies target foreign firms?

CyberespionageBy JOSEPH FITSANAKIS | intelNews.org
Last month, the government of the United States indicted five officers of the Chinese People’s Liberation Army with conspiracy to commit computer fraud, economic espionage, and theft of trade secrets, among other charges. In indicting the five PLA officers, the US Department of Justice went to great pains to ensure that it did not accuse the suspects of engaging in cyberespionage in defense of China’s national security. What sparked the indictments was that the accused hackers allegedly employed intelligence resources belonging to the Chinese state in order to give a competitive advantage to Chinese companies vying for international contracts against American firms. In the words of US Attorney General Eric Holder, the operational difference between American and Chinese cyberespionage, as revealed in the case against the five PLA officers, is that “we do not collect intelligence to provide a competitive advantage to US companies, or US commercial sectors”, whereas China engages in the practice “for no reason other than to advantage state-owned companies and other interests in China”. I recently authored a working paper that was published by the Cyberdefense and Cybersecurity Chair of France’s Ecole Spéciale Militaire de Saint-Cyr, in which I argued that the American distinction between public and private spheres of economic activity is not shared by PLA. The Chinese see both state and corporate cyberespionage targets as fair game and as an essential means of competing globally with the United States and other adversaries. In the paper, I argue that Beijing sees the demarcation between state and private economic activity as a conceptual model deliberately devised by the US to disadvantage China’s intelligence-collection ability. Read more of this post

The mysterious Chinese unit behind the cyberespionage charges

Shanghai, ChinaBy JOSEPH FITSANAKIS | intelNews.org
On Monday, the United States government leveled for the first time charges against a group of identified Chinese military officers, allegedly for stealing American trade secrets through cyberespionage. The individuals named in the indictment are all members of a mysterious unit within the Chinese People’s Liberation Army (PLA) command structure, known as Unit 61398. It is estimated that the unit has targeted at least 1,000 private or public companies and organizations in the past 12 years. Western cybersecurity experts often refer to the group as “APT1”, which stands for “Advanced Persistent Threat 1”, or “Byzantine Candor”. It is believed to operate under the Second Bureau of the PLA’s General Staff Department, which is responsible for collecting foreign military intelligence. Many China military observers argue that Unit 61398 is staffed by several thousand operatives, who can be broadly categorized into two groups: one consisting of computer programmers and network operations experts, and the other consisting of English-language specialists, with the most talented members of the Unit combining both skills. Computer forensics experts have traced the Unit’s online activities to several large computer networks operating out of Shanghai’s Pudong New Area district, a heavily built neighborhood in China’s largest city, which serves as a symbol of the country’s rapid industrialization and urbanization. Among other things, Unit 61398 is generally accused of being behind Operation SHADY RAT, one of history’s most extensive known cyberespionage campaigns, which targeted nearly 100 companies, governments and international organizations, between 2006 and 2011. The operation is believed to be just one of numerous schemes devised by Unit 61398 in its effort to acquire trade secrets from nearly every country in the world during the past decade, say its detractors. American sources claim that the PLA Unit spends most of its time attacking private, rather than government-run, networks and servers. As the US Attorney General, Eric Holder, told reporters on Monday, Unit 61398 conducts hacking “for no reason other than to advantage state-owned companies and other interests in China, at the expense of businesses here in the United States”. But The Washington Post points out that the recent revelations by US intelligence defector Edward Snowden arguably make it “easier for China to dismiss” Washington’s charges, since they point to Read more of this post

Comment: Is China the New Spy Superpower?

US and China

US and China

By JOSEPH FITSANAKIS* | intelNews.org |
In fifteen years of monitoring intelligence-related developments, I have rarely seen so many news items about China appear simultaneously in the Western press, as I did during the past fortnight. On December 5, financial news network Bloomberg reported that the United States government invoked “Cold War-era national security powers” to compel telecommunications companies operating on American soil to disclose confidential data about their networks. The plan, spearheaded by the US Department of Commerce, but undoubtedly prompted and monitored by the National Security Agency, features a detailed survey distributed to dozens of telecommunications service providers, as well as hardware and software developers. The latter are reportedly required to supply “a detailed accounting” of every piece of “foreign-made hardware and software” installed on their networks, in a move that Bloomberg interprets as “a hunt for Chinese cyber-spying”. A few days later, intelligence researcher and author David Wise opined in The New York Times that the West had better recognize that China “has developed a world-class espionage service —one that rivals the CIA”. He qualified his statement by providing several examples of major espionage triumphs achieved by the Chinese intelligence services in the last decade, such as the acquisition of design blueprints for the US-built B-1 bomber and Northrop Grumman’s B-2 stealth bomber. Other examples given by Wise include China’s attainment of the design specifications for the US Navy’s Quiet Electric Drive system, aimed at enhancing the stealth abilities of submarines, as well as the remains of the modified Black Hawk helicopter that crashed in Abbottabad, Pakistan, during the CIA-led operation to assassinate al-Qaeda founder Osama bin Laden last May. Most of all, Wise laments the acquisition by the Chinese of the design specifications for the W-88 warhead, the symbol of America’s next-generation of mini-nuke weapons. Read more of this post

Video of Chinese general’s espionage lecture leaked onto YouTube

Jin Yinan

Jin Yinan

By JOSEPH FITSANAKIS | intelNews.org |
Video footage of a lecture on recent espionage incidents against China, delivered before a vetted audience by a senior Chinese military official, has been leaked to online video sites, including YouTube. The lecturer has been identified as Major General Jin Yinan, and the location appears to be one of the main lecture halls at China’s National Defense University (NDU) in Beijing. Administered by the Central Committee of the Chinese People’s Liberation Army (PLA), NDU is China’s equivalent of the United States’ West Point Military Academy. The precise date of the venue cannot be verified, though it appears to have been intended as a cautionary lesson for NDU students, on the fate that awaits Chinese officials spying against their country. In the video, General Jin laments the fact that too many Chinese Communist Party members have “become decadent” and have succumbed to selling classified national secrets to foreign adversaries. He also discusses several recent cases of espionage against China, including that of Xu Junping, a senior colonel in the PLA, who defected to the United States in December of 2000. The speaker also mentions the case of Tong Daning, a Social Security Department economist who was executed in 2006 for sharing classified Chinese economic data with Taiwanese intelligence operatives. But the primary revelations of the speech concern the cases of Li Bin and Kang Rixin, which General Jin addresses in detail. Li Bin was arrested during his tenure as China’s Ambassador to South Korea, and was eventually sentenced to a seven-year prison term for corruption. But General Jin discloses in his speech that the Ambassador was arrested for selling classified information to South Korean intelligence, and that the Chinese prosecutors decided to bring him up on corruption charges, to “avoid embarrassing [our] country”. Read more of this post

Chinese telecoms manufacturer denies spying claims (again)

Huawei HQ

Huawei HQ

By IAN ALLEN| intelNews.org |
Huawei Technologies is one of China’s fastest-rising corporations. Founded in 1988 to import Western office telephone systems to China, the company today has become one of the country’s leading exporters, producing all kinds of hi-tech communications hardware equipment, ranging from routers to cell towers and undersea cables. But, as intelNews has indicated on several instances, Huawei’s export growth has been hampered in recent years by widely circulated suspicions that the company maintains close ties to the Chinese military and intelligence establishments. In 2009, the Australian Security Intelligence Organisation (ASIO) investigated one of Huawei’s Australian-based subsidiaries for links to Chinese intelligence operations. In the following year, the Indian government barred the company from operating in India, citing its allegedly “strong links with the Chinese military”. In August of 2010, several American senators called for an investigation into a proposed collaboration between Huawei and US-based Sprint-Nextel, arguing that the Chinese hardware manufacturer is “effectively controlled by China’s civilian and military intelligence establishment”. Further controversy erupted in the United States in February of this year, when another group of American Congress members accused Huawei of having supplied telecommunications equipment to Iran and the Afghan Taliban. The controversy around Huawei, which currently employs over 110,000 people in China and beyond, centers partly on its founder and chief executive owner, Ren Zhengfei. A former Director of the People’s Liberation Army’s Engineering Corps, Zhengfei founded Huawei a few years after retiring from his government job. His critics claim that he never truly retired from the PLA, and that he maintains routine links with the Communist Party of China, of which he is a member, as well as Chinese military intelligence. Read more of this post

News you may have missed #496

  • US secretly collaborating with Chinese spies on North Korea. Leaked records of highly sensitive US-China defense consultations reveal that the CIA, the US Office of the Director of National Intelligence, and the US Defense Department, have all held secret discussions on North Korea with Chinese military intelligence.
  • Cuba denounces acquittal of ex-CIA agent. Cuba has denounced as a ‘farce’ the acquittal in the United States of Luis Posada Carriles, a former CIA agent who Havana says participated in terrorist attacks against the island. Carriles was accused of lying to US immigration officials.
  • Analysis: US spy agencies struggling to adjust to Middle East changes. With popular protests toppling rulers in Tunisia and Egypt and threatening leaders in Yemen and elsewhere, US intelligence agencies are struggling to adjust to a radically changed landscape, US officials, former intelligence officers and experts say.

CIA slowly opens up about botched 1952 mission in China

CIA HQ

CIA HQ

By JOSEPH FITSANAKIS | intelNews.org |
The CIA has produced an hour-long documentary about a failed 1952 covert mission inside China, which resulted in the death of two American pilots and the capture of two CIA paramilitary officers, who spent a total of 40 years in Chinese prisons. The documentary, which premiered last week on a restricted basis at the Agency’s Langley, Virginia, headquarters, is based on internal CIA accounts of the operation, some of which were released in 2006. The premiere was reportedly attended by John Downey and Richard Fecteau, two CIA paramilitary officers on their first mission, who were captured by Chinese People’s Liberation Army (PLA) units inside Chinese territory, after the CIA-operated C-47 Skytrain airplane that was carrying them deep inside Chinese airspace was shot down in a Chinese ambush. Read more of this post

India blacklists Chinese phone companies over spying concerns

Huawei HQ

By IAN ALLEN | intelNews.org |
The government of India has officially barred a number of Chinese telephone equipment providers from operating in India, citing their strong links with the Chinese military. At the center of the move is Huawei Technologies, one of China’s largest telephone equipment manufacturers. Several intelligence insiders see the company, based in Shenzen, China, as a covert arm of the intelligence wing of the Chinese People’s Liberation Army. The company, which has business concerns in several countries around the world, has attracted the attention of American, British and Australian counterintelligence agencies, among others. In early 2008, the US government prohibited Huawei’s purchase of a significant amount of shares in US network security equipment maker 3Com, which supplies telecommunications hardware to the US Department of Defense. Read more of this post

Leaked MI5 report sees China as ‘most significant’ spy threat

By JOSEPH FITSANAKIS | intelNews.org |
A restricted MI5 report describes China as Britain’s most serious espionage threat, and says British business executives are increasingly targeted by Chinese intelligence operatives. The 14-page document was authored by the Centre for the Protection of National Infrastructure, a unit of MI5, Britain’s primary counterintelligence and security agency. In it, the intelligence agencies of the Chinese People’s Liberation Army, as well as the Ministry of State Security, are identified as leaders in a massive targeting of British corporate executives who regularly make business trips to China. The report warns that most of the hotel rooms where they stay are “likely to be bugged”, that they are regularly “searched while the occupants are out of the[ir] room[s]”, and that hotels are frequented by Chinese female intelligence agents, looking “to exploit vulnerabilities such as sexual relationships and illegal activities”. Read more of this post

Australians investigate Chinese telecom over suspected spy links

Huawei HQ

Huawei HQ

By IAN ALLEN | intelNews.org |
The Australian Security Intelligence Organisation (ASIO), has admitted it is investigating an Australian-based subsidiary of a Chinese telecommunications firm because of its rumored links to China’s intelligence establishment. Several intelligence insiders see Huawei Technologies, based in Shenzen, China, as a covert arm of Chinese military intelligence. The company, which has business concerns in several countries around the world, has attracted the attention of American, Indian and British counterintelligence agencies, among others. As intelNews reported last December, in 2005 the government of India cancelled an initial investment of $60 million on its telecommunications superhighway by the Chinese company. Read more of this post

Australians suspect Chinese networking firm of intelligence ties

Several months ago, Chinese networking investor Singtel Optus placed a very competitive bid on the Australian government’s $15 billion project to build the country’s first unified national broadband network. Now the Australians say they are suspicious of the company, because of its ties to China’s Huawei Technologies. Huawei is described as a “shadowy company based in Shenzen and founded by former People’s Liberation Army officer and Communist Party member Ren Zhengfei”. Read more of this post

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