U.S. Charges Five Chinese Military Hackers For Cyber Espionage Against SolarWorld And Other U.S. Entities

SI Staff
Written by Michael Puttre
on May 20, 2014 No Comments
Categories : New & Noteworthy

A grand jury in the Western District of Pennsylvania has indicted five Chinese military hackers for computer hacking, economic espionage and other offenses directed at the U.S. subsidiary of SolarWorld AG, four companies in the U.S. nuclear power and metals industries, and one trade union.

According to the U.S. Department of Justice (DOJ), in 2012, at about the same time the U.S. Commerce Department found that Chinese solar product manufacturers had dumped products into U.S. markets at prices below fair value, two of the alleged Chinese military hackers named in the indictment stole thousands of files, including information about SolarWorld's cash flow, manufacturing metrics, production line information, costs and privileged attorney-client communications relating to ongoing trade litigation, among other things. Such information would have enabled a Chinese competitor to target SolarWorld's business operations aggressively from a variety of angles, the DOJ says.

SolarWorld is engaged in long-running disputes with Chinese competitors in the solar photovoltaic manufacturing industry over alleged anti-competitive trade practices. SolarWorld's actions are deeply unpopular in the U.S. solar sector, with many saying retaliatory action by China could doom the industry. The Solar Energy Industries Association has led the charge against SolarWorld's anti-dumping campaign, and has made prominent efforts to mediate a compromise.

The indictment says that in some cases, the conspirators stole trade secrets that would have been particularly beneficial to Chinese companies at the time they were stolen. In other cases, it alleges, the conspirators also stole sensitive, internal communications that would provide a competitor, or an adversary in litigation, with insight into the strategy and vulnerabilities of the U.S. entity.

‘We are deeply troubled by allegations that Chinese military officials illegally hacked into our computer systems,’ says Devon Cichoski, corporate communications manager for SolarWorld Industries America Inc. ‘It's yet another example of the Chinese government's systematic campaign to seek unfair advantage in the U.S. and global solar industry. SolarWorld applauds the U.S. Department of Justice for enforcing laws safeguarding fair and legal commerce.’

Cichoski stresses that no databases of employee or customer information were breached by the hackers. Immediately after the intrusions came to light, SolarWorld further tightened its IT security, she says.

Besides SolarWorld, other targets of the Chinese cyberspying efforts indentified in the indictment are Westinghouse Electric Co.; United States Steel Corp.; Allegheny Technologies Inc.; Alcoa Inc.; and the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union.

‘This is a case alleging economic espionage by members of the Chinese military and represents the first-ever charges against a state actor for this type of hacking,’ U.S. Attorney General Eric Holder said, in a statement. ‘The range of trade secrets and other sensitive business information stolen in this case is significant and demands an aggressive response.’

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