Congress Fears Chinese Telecom Gear May Phone Home
WIRED
By Adam Rawnsley
November 17, 2011

Photo: Wikimedia

Are telecommuniations deals with China good business — or a trojan horse for espionage? Some of Congress’ top intelligence officials are worried it’s the latter. And they’re launching an investigation to find out.

Rep. Mike Rogers (R-Mich.), chairman of the House Permanent Select Committee on Intelligence (HPSCI), and the committee’s top Democrat, Rep. Dutch Ruppersberger, announced on Thursday that their committee will look into the potential for Chinese telecommunications equipment — like commercial servers, routers and switches — to help China spy on the United States.

“The investigation is to determine the extent to which these companies provide the Chinese government an opportunity for greater foreign espionage, threaten our critical infrastructure, and further the opportunity for Chinese economic espionage,” Rogers tells Danger Room. “Through this investigation we will come to a better understanding of the threat so we are better prepared to mitigate.”

The concern is that Chinese companies could tamper with equipment for use in civilian communications infrastructure, allowing China to insert Trojan horses that eavesdrop on targets in the United States. Chinese companies already make a number of telecommunications products sold in the U.S., but several have bowed out of deals to acquire large stakes in American telecom companies after facing U.S. government pressure.

Rogers says the investigation is an outgrowth of a review he commissioned shortly after becoming chairman of the committee in January.

“The findings in that preliminary review indicate that a full investigation was warranted,” he explains. “I have serious national-security concerns about Huawei, ZTE and other infrastructure companies, and will use all of the committee’s resources to determine the extent of the threat and what the government is doing about it.”

Both Huawei and ZTE have been involved in a bids to gain a great foothold in the U.S. market — only to be turned down over espionage fears.

In the past few years, Huawei was rebuffed in its attempts to purchase network infrastructure manufacturer 3Com and backed out of a deal for server company 3Leaf, after Congress and the executive branch’s Committee on Foreign Investment in the United States raised red flags. Pentagon officials claim the company has close connections to China’s People’s Liberation Army. And in November of last year, Sprint dropped ZTE from a major U.S. telecommunications infrastructure contract, under pressure from the administration and Congress.

In a joint statement released with Ruppersberger, Rogers says the investigation won’t just focus on Chinese espionage capabilities, but also on whether America’s own spooks can find and thwart any spy gear.

The House committee inquiry comes on the heels of a similar initiative from the Obama administration, first reported by the Wall Street Journal’s Siobhan Gorman, to examine the espionage risk of Chinese telecommunications companies building American telcom infrasturcture.  There, too, the administration’s concerns reportedly center on Huawei.

But telecommunications companies aren’t the only source of China-related supply chain headaches the U.S. government has these days.

Iarpa, the intelligence community’s advanced research shop, recently dropped $49 million on a program designed to keep China and other potential adversaries from tampering with microprocessors intended for use in American weapons systems or computers accessing classified information. Iarpa’s Trusted Integrated Chip project focuses on finding ways to securely build chips abroad at foreign foundries that are often cheaper than their counterparts in the United States. Darpa, Iarpa’s cousin at the Pentagon, has a similar program designed to spot already-hacked chips.

Separately, the Senate Armed Services Committee has been looking into counterfeit electronics parts, often sourced from China, making their way into U.S. military equipment.

Rogers says the spy agencies he’s spoken with “clearly appreciate the importance of the issue,” but he’s hoping the Intelligence Committee’s investigation “will contribute to a greater understanding of that threat and help encourage a more rapid response to this emerging national security concern. We cannot wait any longer.”

Direct Link: http://www.wired.com/dangerroom/2011/11/china-trojan-horse-congress/