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FBI Warns Companies About Embedded Spies In Chinese Companies

Days after banning China Telecom, the head of the FBI has urged companies including those in Australia to forge closer ties with the US crime agency to stop Chinese spying and theft of intellectual property.

FBI Director Christopher Wray told the Economic Club of New York last night that “most of the time” cyber thefts or other intellectual property threats are “coming from the Chinese government or companies under the Chinese government ‘s sway”.

This is a similar message that Australian security agencies are telling Australian executives, whose businesses could be exposed to Chinese spying and theft of IP.

One concern according to the FBI, is Chinese Companies selling products locally whose senior management have to respond to requests from the Chinese Communist Government.

Wray’s call to action was the latest in a series of dire warnings he has issued about Chinese espionage since he assumed his role at the FBI in 2017. They have risen in urgency since he told a Senate Homeland Security Committee in 2018 that China poses a greater security threat to the US than Russia did.

His comments came hours after the US Justice Department arrested a top Beijing intelligence official for allegedly trying to steal trade secrets from GE Aviation and other US aerospace companies some who already operate in Australia and have close ties with the Australian Defence Industry.

The arrest was followed by the announcement of the department’s “China Initiative”, which was meant to bolster coordination across the US government and key partners such as Australia to stymie Chinese espionage.

ChannelNews understands that ASIO the Australian spy agency are also concerned and have been working with the Australian Federal Police to monitor Chinese technology subsidiaries and their employees.

This includes Companies such as Huawei and other Chinese Companies that are selling hardware that is being installed into networks in Australia.

One Company is China Telecom who have close ties to local carriers such as Optus, AAPT and Vodafone TPG and in the past have had access to the networks of several large organisations in Australia as well as businesses developing new technology, medical, aviation and military hardware and software in Australia.

During the address to the Economic Club of New York, Wray, encouraged its members to establish partnerships with the agency’s local offices – before breaches occur like the Microsoft Exchange email server hack discovered earlier this year.

Australia, the US, Britain and EU have accused China of sponsoring the massive Microsoft email server hack.

“Too often when we see a cyberthreat and start digging, we find that the same adversary is also working with an unwitting company insider to target … sensitive and proprietary information,” Wray said.

He continued: “Or they may be going after it through a foreign-controlled company trying to use a corporate transaction like a joint venture or something as a way to get access to the information.”

“Most of the time that threat is coming from the Chinese government or companies under the Chinese government ‘s sway, and to say that they’re well-resourced would be an understatement,” Wray added. “No company is armed to defend against that kind of multi-avenue threat alone and that’s why we’ve got to be working together.”

According to the South China Morning Post, his comments have prompted an outcry from the Chinese community and civil rights activists concerned that academics and others of Chinese descent were being unfairly targeted.

Wray warned about academics and researchers with connections to China in his address.

China is “using intelligence services to go after intellectual property held by the private sector or by our academic institutions, but they’re also using so-called non-traditional collectors – and what I mean by that are businessmen, different kinds of researchers and graduate students, scientists, ostensibly private companies”, he said.

Wray added that many such individuals and organisations are “effectively under the thumb of the Chinese Communist Party, all geared towards a common aim of trying to steal our information to put the Chinese government in a way to become the world’s only superpower”.

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