Security Service Heads Warn Businesses Of Risks, Associated With Chinese Linked Companies

As China attempts to nobble Australian trade, technology businesses are being warned by intelligence services, to be wary of attempts by China to steal the intellectual properties of Companies.

Last night the heads of the FBI and Britain’s internal security service held a rare press briefing warning businesses to not trust Chinese businesses and the threats posed by Chinese espionage, especially as these businesses often engage in spying for the Chinese Communist Party.

The briefing took place at the headquarters of MI5, Christopher Wray, director of the Federal Bureau of Investigation, and Ken McCallum, director-general of MI5, urged executives not to underestimate the scale and sophistication of Beijing’s campaign.

In the past MI5 and the FBI have warned organisations such as telecommunication carriers to be wary of doing business with Chinese suppliers with Chinese Companies buying into businesses in an effort to get access to information.

“The Chinese government is set on stealing your technology—whatever it is that makes your industry tick—and using it to undercut your business and dominate your market,” Mr. Wray told the audience of businesspeople. “They’re set on using every tool at their disposal to do it.”

They have also warned that Chinese Companies a “powerless” when asked by Chinese intelligence organisations to spy on Companies.

Recently questions were raised about the proposed deal between TPG Telecom and Telstra’s plan to share networks and information with a Company that is predominantly owned by a China based Company, CK Hutchison Holdings Limited who also own a share of Vodafone via other subsidaries.

The Hong Kong based Company is currently facing a review by the Australian Competition and Consumer Commission.

US and UK security officials Wray and McCallum warned that China uses state-sponsored hacking on a large scale along with a global network of intelligence operatives in its quest to gain access to technology it considers important.

Some claim access to the Telstra network in Australia would be of value to a Chinese linked Company.

“We want to send the clearest signal we can on a massive, shared challenge—China, “Wray said. Tackling the threat is essential “if we are to protect our economies, our institutions, and our democratic values

This week U.S. counterintelligence officials issued a notice warning state and local government leaders and business executives about what they see as China’s increasing efforts to influence policymaking through overt and covert means.

The notice, from the U.S. National Counterintelligence and Security Center, cited tactics ranging from lobbying to using front groups and threatening to withhold trade and investment opportunities.

At this stage it’s not known whether TPG Telecom and Hutchinson have used local lobbyists to try and influence the ACCC.

The Wall Street Journal reported that the FBI is opening a new counterintelligence investigation into China roughly every 12 hours.

Mr. McCallum said MI5 was running seven times as many investigations into suspicious Chinese activity now as it was in 2018.

China is engaged in “a coordinated campaign on a grand scale” that represents “a strategic contest across decades,” Mr. McCallum said. “We need to act.”

The FBI and MI5 claim that Chinese immigrants “are themselves frequently victims of the Chinese government’s lawless aggression.”

ChannelNews has been told that Chinese supplier of technology products in Australia are often used to obtain information.

In a statement overnight, a spokesman for China’s embassy in Washington, Liu Pengyu, criticized what he characterized as “politicians who have been tarnishing China’s image and painting China as a threat with false accusations.”

The FBI director said he didn’t want to discourage companies from doing business with China altogether. But he voiced serious scepticism about commercial interactions with Chinese partners and said executives need to evaluate the risk of such dealings correctly.

“Maintaining a technological edge may do more to increase a company’s value than would partnering with a Chinese company to sell into that huge Chinese market, only to find the Chinese government and your partner stealing and copying your innovation,” he said.