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Why Chinese spies are sending chills through Silicon Valley
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Why Chinese spies are sending chills through Silicon Valley

Linwei Ding had been working at Google’s headquarters in California for four years when he booked a one-way ticket to Beijing and handed in his notice on Boxing Day.

Resignation posed questions to the tech giant’s security teamwho had already investigated Ding. A few weeks earlier, Ding insisted he had no plans to quit when he was confronted with unusual activity on his employee account.

After reviewing CCTV footage, investigators discovered that a few weeks earlier, the Chinese national had convinced a colleague to scan his badge to Google offices, creating the illusion that he was at work.

Ding had actually been thousands of miles away in China – posing as the chief executive of a company called Zhisuan and looking to raise funds. On January 6, the day before his flight was to depart, FBI agents raided his home and seized his devices and passport.

Earlier this year, the US Department of Justice charged Ding, 38, with stealing trade secrets from Google. Prosecutors said he uploaded more than 500 files related to Google’s artificial intelligence technology to a personal account in an attempt to launch his own companies in China.

“We will fiercely protect sensitive technologies developed in America from falling into the hands of those who should not have them,” promised Merrick Garland, the US attorney general.

Ding pleaded not guilty. If convicted, he faces decades in prison.

But his case is far from unique. Silicon Valley companies have become a growing target for corporate espionage and commercial theft.

In recent years, the US government has accused individuals of stealing technology from companies like Tesla, Apple and IBM and trying to transfer it to China, often successfully.

Last year, the intelligence chiefs of the “Five Eyes” nations gathered at Stanford University — the cradle of Silicon Valley innovation — to warn tech companies that they are increasingly under threat.

“If you’re operating at the cutting edge of technology this decade, you might not be interested in geopolitics, but geopolitics is interested in you,” said Ken McCallum, director general of MI5.

Spying is nothing new in Silicon Valley, which owes its status as an innovation hub to the amount of US government spending during the Cold War, funding processors that could target missiles and put men on the moon.

Soviet agents routinely attempted to acquire microchip knowledge and plans, though Moscow’s attempts to match US mastery failed. A decade ago, Saudi agents infiltrated Twitter to obtain data on thousands of accounts and expose dissidents who used the social network to criticize the regime.

But an increasingly assertive China, which has ambitions to match the US as a technological superpower, has dramatically stepped up its activity.

Beijing ‘Targets Chinese Diaspora’

Beijing’s mission to acquire cutting-edge technology given greater urgency by strict US export controls that have cut off China’s supply of advanced microchips and artificial intelligence systems. Ding, the former Google employee, is accused of stealing designs for the company’s AI chips.

This has raised suspicions that the technology is being obtained illegally. US officials recently launched an investigation into how advanced chips ended up in a phone made by China’s Huawei, amid concerns that it is illegally circumventing a range of US sanctions. Huawei has denied the claims.

US officials fear that cutting-edge chips or AI expertise could boost Chinese military capabilities. A Defense Department report last year warned that AI could be used to identify US weaknesses and control autonomous weapons.

Last week it emerged that researchers linked to the People’s Liberation Army had used Meta technology to develop an AI tool for military applications. Meta said any such use is “unauthorized and against our acceptable use policy.”

“As controls tighten, China’s incentive to acquire banned technology increases,” says William Hannas, a former CIA official at the Center for Security and Emerging Technologies.

Zach Dorfman, an investigative journalist in the San Francisco Bay Area, says Chinese intelligence services have always had a presence in the region because of the substantial Chinese diaspora there. Demonstrations supporting the Falun Gong movement, which opposes the Chinese Communist Party, are frequent sights in the city.

“There has been an influence campaign for decades to try to change diaspora communities to make them more pro-Beijing. You have a huge community and there will always be people on the fringes who can give you support and local assets that you can have on the ground.

“You’re talking about a small portion of (that) population, but you’ve got people potentially infiltrating tech companies.”

Attendees at tech parties and conferences in Silicon Valley often enjoy gossiping about who might be a spy in the room—the FBI has a regular booth at CES, the world’s biggest tech show.

But only occasionally have cases been made public of people stealing technology explicitly for the Chinese state. In 2018, a former IBM employee was sentenced to five years in prison after being accused of stealing source code for Beijing.

“State Sponsored Theft”

Nigel West, an intelligence expert, says the theft more often involves Chinese nationals who know they will be able to set up companies back in China with impunity, even if they steal technology to do so.

“Virtually all citizens of the People’s Republic of China who travel abroad and work in technology companies are allowed by the MSS (Ministry of State Security of China) to steal proprietary information, take it back to China and profit from it, either by exploiting them, either run in parallel. organizations and companies that sell the same types of products and services,” says West.

“It is state sponsored by MSS.”

The model is demonstrated by public cases of technology transfer. In June, Klaus Pflugbeil, a Canadian citizen living in China, pleaded guilty to stealing battery manufacturing secrets from Tesla to set up a business in China.

At least three former Apple employees have been accused of stealing secrets from Apple for self-driving cars before trying to flee the US to profit from them. Two have pleaded guilty, while one from China has not formally responded to the charges.

In recent months, tech companies have stepped up staff screening in an attempt to counter what is seen as a growing Chinese threat. Last year, the US government launched a “Disruptive Technology Strike Force” designed to prevent the theft of high-tech secrets from companies, although a separate Trump-era “China Initiative” was shut down two years ago amid concerns about racial profiling.

Hannas, the former CIA official, says the West is finally waking up to the problem. “This is not a new problem,” he says. “What’s new is the belated recognition of the threat by tech companies and their national governments.”