Western Spy Chiefs Sound Alarm on Chinese Espionage at Silicon Valley Meeting

Representatives of the Five Eyes intelligence sharing network (FBI)

The Lede: Leading Western intelligence officials issued comments on Tuesday accusing China of intellectual property theft and using artificial intelligence for hacking and spying on technology firms in their nations following meetings with private companies in the U.S. innovation hub Silicon Valley. The meeting comes as the rivalry between the Western allies and China permeates the areas of national security, diplomacy, and advanced commercial technology.

What We Know:

FBI director Christopher Wray hosted officials from the Five Eyes intelligence sharing network at Stanford University. The group comprises the U.S., U.K., Canada, Australia, and New Zealand in an effort to turn attention to risks posed by China in sensitive technology sectors ranging from quantum computing and artificial intelligence to synthetic biology. His counterparts include Mike Burgess, head of the Australian Security Intelligence Organization, David Vigneault, director of the Canadian Security Intelligence Service, and Andrew Hampton, New Zealand’s Security Intelligence Service chief.
The intelligence officials said that China was using hacking, pressure on Chinese students, informants in Western companies, and joint ventures with Western firms to access and steal critical technology. Vigneault noted that laws in China compelled nationals anywhere in the world to provide information to Beijing’s intelligence services.
This is the first time the Five Eyes intelligence network has jointly and publicly called out China on it.

The Background: Shortly before the meeting of The Commerce Department strengthened export restrictions on U.S. produced chips in an effort to manage China’s development of AI and other technologies that could be used for military and security purposes. The U.S. Justice Department has also recently been working on shutting down illegal overseas police stations that have allegedly been used to monitor and intimidate dissidents as part of this security matter.

Likely Outcomes:

Technology firms, while concerned about intellectual property theft, may be more concerned by government measures to limit the sale of their products to China. Private firms may take extra precautions moving forward to keep up with the threats detailed in these warnings, but these comments likely signal a renewed urgency by the national security side of Western governments and a desire to bring about policy to address these concerns about spying and the technological competition with China.
Future measures will likely include stricter mandates on technology companies, research institutions, and perhaps tighter requirements in the flow of Chinese nationals. It is also likely that Chinese business operations in the U.S. and Western countries will face even greater scrutiny.
High-skilled Chinese nationals working in these sensitive fields may take their talents to other parts of the world or remain in China as relocation to the West is expected to be less attractive.

Quotables:

"Part of what makes it so challenging is all of those tools deployed in tandem, at a scale the likes of which we've never seen. We worry about AI as an amplifier for all sorts of misconduct. If you think about what AI can do to help leverage that data to take what's already the largest hacking program in the world by a country mile, and make it that much more effective - that's what we're worried about.” - Christopher Wray, director of the FBI

“The Chinese government is engaged in the most sustained, scaled and sophisticated theft of intellectual property and expertise in human history. China has developed a ruthless business model aimed at seizing commercial advantage . . . stealing intellectual property is the first step.” – Mike Burgess, director general of security of the Australian Security Intelligence Organization (ASIO)

“If you are anywhere near the cutting edge of tech, you may not be interested in geopolitics, but geopolitics is interested in you.” – Ken McCallum, director general of MI5

Good Reads:

Five Eyes spy chiefs warn Silicon Valley over Chinese threat (FT)

Allied Spy Chiefs Warn of Chinese Espionage Targeting Tech Firms (NYT)

Five Eyes intelligence chiefs warn on China's 'theft' of intellectual property (Reuters)