Global Weekly Executive Summary, 22 June 2018

A cyberattack on a US Navy contractor resulted in the theft of sensitive military plans in this latest incident of Chinese industrial espionage targeting military contractors.

Government hackers working for China’s Ministry of State Security have stolen 614 gigabytes of “highly sensitive” from a US Navy contractor.

According to a Washington Post article, the data accessed included information on an anti-ship missile project under development, “signals and sensor data, submarine radio room information relating to cryptographic systems, and the Navy submarine development unit’s electronic warfare library.” The article also stated that “details on hundreds of mechanical and software systems were compromised.”

A BBC article reported that the stolen data was housed on the contractor’s unclassified network despite being described as sensitive “due to the nature of the technology being developed and links to other military projects.” The Washington Post article reported a US official as saying that “the material, when aggregated, could be considered classified.”

The unnamed contractor was employed by the Naval Undersea Warfare Center, an organization that conducts research and development for submarines and underwater weaponry.

China’s Ministry of State Security, the perpetrator of the data theft, is described by the Washington Post as “a civilian spy agency responsible for counterintelligence, foreign intelligence and domestic political security“ which includes a foreign hacking department.

Significance

This incident is the latest in a long string of similar industrial espionage efforts by China to target and collect US intellectual property by technological means or through business partnerships. In the past ten years, China has stolen US military aircraft, ship, and weapons system designs and plans.

Earlier this year, Director of National Intelligence Daniel Coates testified before congress that “Most detected Chinese cyber operations against US private industry are focused on cleared defense contractors or IT and communications firms whose products and services support government and private sector networks worldwide” and that China would “continue to use cyber espionage and bolster cyber attack capabilities to support national security priorities.”

On the subject of technology acquisitions, Coates testified that “China… has acquired proprietary technology and early-stage ideas through cyber enabled means. At the same time, some actors use largely legitimate, legal transfers and relationships to gain access to research fields, experts, and key enabling industrial processes that could, over time, erode America’s long-term competitive advantages.”

Sources

Washington Post, China hacked a Navy contractor and secured a trove of highly sensitive data on submarine warfare, 8 June 2018

CBS News, Chinese government hacked U.S. Navy contractor, officials say, 8 June 2018

Office of the Director of National Intelligence, STATEMENT FOR THE RECORD: WORLDWIDE THREAT ASSESSMENT OF THE US INTELLIGENCE COMMUNITY, 13 February 2018

BBC, China hackers steal data from US Navy contractor – reports, 9 June 2018

ExecutiveGov, Report: China Compromised Submarine Warfare Data Stored in Navy Contractor’s Computers, 11 June 2018

New York Times, Chinese Hackers Steal Unclassified Data From Navy Contractor, 8 June 2018

Washington Post, Confidential report lists U.S. weapons system designs compromised by Chinese cyberspies, 27 May 2013