Chinese army officers charged with hacking into American companies

Five Chinese army officers have been charged in US with hacking into private-sector American companies in a bid for competitive advantage, in the first cyber-espionage case of its kind.

Attorney General Eric Holder said the alleged breaches were “significant” and demanded “an aggressive response”.

US prosecutors say the Chinese officers stole trade secrets and internal documents from five companies and a labor union.

China denied the charges and warned the case would harm US-China relations.

Eric Holder said a grand jury had laid hacking charges against the Chinese nationals, the first against “known state actors for infiltrating US commercial targets by cyber means”.

He identified the alleged victims as Westinghouse Electric, US Steel, Alcoa Inc, Allegheny Technologies, SolarWorld and the US Steelworkers Union.

“The alleged hacking appears to have been conducted for no reason other than to advantage state-owned companies and other interests in China, at the expense of businesses here in the United States,” Eric Holder said.

In response, the Chinese government said its “stance on the issue of internet security is consistent and clear”.

Foreign ministry spokesman Qin Gang said the allegations were “made up” and would “damage Sino-American cooperation and mutual trust”.

“China is a staunch defender of network security, and the Chinese government, military and associated personnel have never engaged in online theft of trade secrets,” he said.

In an indictment in the western district of Pennsylvania, the heart of the US steel industry, the US named Wang Dong, Sun Kailiang, Wen Xinyu, Huang Zhenyu, and Gu Chunhui, all officers in Unit 61398 of the Chinese People’s Liberation Army (PLA), as the alleged conspirators.

FBI officials said the hacking in the years 2006-14 caused “significant losses” at the companies and that there were likely many more victims.

Eric Holder said the US government “categorically denounces” economic espionage as a trade tactic.

“As President Obama has said on numerous occasions, we do not collect intelligence to provide a competitive advantage to US companies, or US commercial sectors,” he said.

The move is seen as largely symbolic, as five men accused are unlikely to be extradited to the US to faces the charges in court.

John Carlin, head of the justice department’s national security division, said: “For the first time, we are exposing the faces and names behind the keyboards in Shanghai used to steal from American businesses.”

“While the men and women of our American businesses spent their business days innovating, creating, and developing strategies to compete in the global marketplace, these members of unit 61398 spent their business days in Shanghai stealing the fruits of our labor,” he said.

Last year, cyber-defense company Mandiant published a report on a Chinese military unit the firm said was behind the vast majority of significant attacks on American federal agencies and companies.