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Industrial Espionage: How China Sneaks Out America's Technology Secrets (bbc.com) 103

The BBC reports: It was an innocuous-looking photograph that turned out to be the downfall of Zheng Xiaoqing, a former employee with energy conglomerate General Electric Power. According to a Department of Justice indictment, the US citizen hid confidential files stolen from his employers in the binary code of a digital photograph of a sunset, which Mr Zheng then mailed to himself. It was a technique called steganography, a means of hiding a data file within the code of another data file. Mr Zheng utilised it on multiple occasions to take sensitive files from GE....

The information Zheng stole was related to the design and manufacture of gas and steam turbines, including turbine blades and turbine seals. Considered to be worth millions, it was sent to his accomplice in China. It would ultimately benefit the Chinese government, as well as China-based companies and universities. Zheng was sentenced to two years in prison earlier this month. It is the latest in a series of similar cases prosecuted by US authorities. In November Chinese national Xu Yanjun, said to be a career spy, was sentenced to 20 years in prison for plotting to steal trade secrets from several US aviation and aerospace companies — including GE.

It is part of a broader struggle as China strives to gain technological knowhow to power its economy and its challenge to the geopolitical order, while the US does its best to prevent a serious competitor to American power from emerging.... Last July FBI director Christopher Wray told a gathering of business leaders and academics in London that China aimed to "ransack" the intellectual property of Western companies so it can speed up its own industrial development and eventually dominate key industries. He warned that it was snooping on companies everywhere "from big cities to small towns — from Fortune 100s to start-ups, folks that focus on everything from aviation, to AI, to pharma".

At the time, China's then foreign ministry spokesman Zhao Lijian said Mr Wray was "smearing China" and had a "Cold War mentality".

Thanks to long-time Slashdot reader schwit1 for sharing the article.
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Industrial Espionage: How China Sneaks Out America's Technology Secrets

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  • by haruchai ( 17472 ) on Saturday January 21, 2023 @10:41PM (#63228872)

    as they've done within China to foreign automakers

    • Yup, mutually agreed partnerships.

      • by haruchai ( 17472 )

        Yup, mutually agreed partnerships.

        Yes, one side agrees to steal the expertise of another & the other side agrees to like it

    • by fermion ( 181285 )
      What lost the US manufacturing was lack of skilled labor and quality control. The partnerships came about because stagnant US industries found it more profitable to outsource rather than invest in the US

      In industries where there was investment and research in the US, the cutting edge stayed in the US. But what limited what the US could do had to do with quality control.

      We see this with places like Harley Davison. They have a good product, it lack of quality control really limits what they can do in the

      • by ArmoredDragon ( 3450605 ) on Sunday January 22, 2023 @02:44AM (#63229250)

        What lost the US manufacturing was lack of skilled labor and quality control. The partnerships came about because stagnant US industries found it more profitable to outsource rather than invest in the US

        Where the fuck did you get that from? US manufacturing grew to incredible heights after WWII because the rest of the world decided they wanted to try out two ideologies on a large scale: fascism and communism. They ended up blowing each other up, or in the case of Japan, forcing the US to blow them up, then by the end of the war most of the world's manufacturing infrastructure was destroyed.

        But guess who already had a decently large manufacturing capacity and went through the war practically unscathed on its home turf? And the rest of the world needed to rebuild its infrastructure, that only one country had any measurable capacity to produce (and even pay for via the Marshall Plan.) 30 years later, the rest of the world has infrastructure again. The demand for US manufacturing then declines. Then people like you come around blaming it on shit that has nothing to do with it.

        We see this with places like Harley Davison. They have a good product,

        No they don't. They never did. It has had basically the same design and engineering since the 1930s, and they've always been just as unreliable as other cars and motorcycles of that era. Harleys always were hobbyist toys for people who like obnoxiously loud and constant in need of maintenance motorcycles. They became an iconic American brand for the same reason that overly hoppy/bitter beer became the most popular beer in America: Returning WWII soldiers were accustomed to them.

        Because the original designer does not have the skill to do it.

        You're confusing lack of skill with complacency. Harley Davidson in particular never cared much for quality control, because that's not what their customers really cared about or asked for. Their customers cared more about and asked for loud and obnoxious toys. Tastes can and do change, and when they do, companies like Harley either change with it or they just fall behind.

        Harley isn't the only iconic brand like this. Apple fans swear like hell that apple makes the best hardware, but anybody who has actually had apple hardware whilst not being particularly loyal to the brand will see just what kind of a piece of shit macbooks really are: Heavy as a cinderblock, not particularly well put together, keyboard is total shit, and the OS really sucks for any work other than photoshop, which apple fans oddly think is the only actual work that people do with a computer. But at the end of the day, they buy macbooks for the same reason people buy Harleys: They want to impress their friends.

        • Wow and here I thought the most popular beer in America was Bud Light...
          • I suspect that Bud Light is the most popular brand, while IPAs as a whole may outsell it.

            Like warming up a Harley-Davis, I start my drinking with a quick Bud Light to get a head start on being loud and obnoxious.

        • by drinkypoo ( 153816 ) <drink@hyperlogos.org> on Sunday January 22, 2023 @07:13AM (#63229576) Homepage Journal

          US manufacturing grew to incredible heights after WWII because the rest of the world decided they wanted to try out two ideologies on a large scale: fascism and communism. They ended up blowing each other up, or in the case of Japan, forcing the US to blow them up, then by the end of the war most of the world's manufacturing infrastructure was destroyed.

          We delayed entering WWII for political reasons, allegedly, while engaging in war profiteering — Hitler's S.S. would have run out of fuel (literally) if not supplied by American companies, and the Zero was made out of Alcoa aluminum. Our delay meant other countries got bombed to fuck while we remained untouched, profiting further by leasing equipment to other nations. Japan was on the verge of surrender when we dropped the second bomb. Hiroshima and Nagasaki were Japan's manufacturing centers.

          This whole idea that the rest of the world shat itself up without out help is revisionist, apologist, and nationalistic. It's also a lie.

          • We delayed entering WWII for political reasons,

            First, you realize that none of my comments are fundamentally at odds with any of your shitposting right? You're just doing this to take the opportunity to shit on America whilst telling me stuff that I already know. Duly noted, you hate America. But I already knew that.

            allegedly

            Allegedly how? The overwhelmingly broad sentiment of the US at the time was that we really didn't want to get involved in yet another one of Europe's stupid wars. Keep in mind that this wasn't very long after we had just got done sacrificing

          • Japan was on the verge of surrender when we dropped the second bomb. Hiroshima and Nagasaki were Japan's manufacturing centers.

            Where do you get this? They had no intention of surrendering. They barely surrendered even with the bombs, see the "Kyujo Incident" .Their armies in all of China were essentially undefeated, and I used to work with a Japanese teacher who recalled being trained with bamboo spears to fight the coming invaders, and he was 8 at the time. I also don't remember Hiroshima being a particularly large manufacturing center. It was, however, heavily military since the the Russo-Japanese war. Source- I lived there.

        • by hackertourist ( 2202674 ) on Sunday January 22, 2023 @08:11AM (#63229638)

          The entire US auto industry got close to being wiped out because not only did demand for their products from abroad dry up, they got their asses kicked in the US domestic market too. Part of this was bad designs (gas-guzzlers in the 1970s oil crisis), another major contributing factor was lack of quality control. Japan was able to supply cars that Just Worked, that were reliable despite long service intervals, when US manufacturers, seemed unable to build cars that didn't fall apart.

          • In other words, complacency.

          • I bought my first Toyota in '74. I was doing a lot of driving around the country during the Oil Cartel inflation. Besides low gas it had a tilt back seat, which only Rambler had at the time for US brands. Bought a second one a few years later, same reasons. Saved a lot on gas, not so much on repairs. Mostly they ran ok (except that one time in the middle of Montana where the damned points broke (points!)).

            I bought an American again in the 00's. Better quality than the terrible 80's and the 90's, but still n

            • Note that is the "Initial Quality Survey". It doesn't measure how well the car holds up over time.

              • Absolutely. I didn't expect to find US car makers to be at the top of *any* lists, so I remarked on the first one that I looked at. I'll admit that I haven't paid any attention to those lists in a while.

  • by iAmWaySmarterThanYou ( 10095012 ) on Saturday January 21, 2023 @11:04PM (#63228904)

    Steganography? Oh, please. Whatever with the spy v spy stuff for the article.

    If anyone knows enough about your activity to examine your photos for hidden codes then you're already busted.

    Copy to a usb stick, go on vacation, hand usb stick to your handler. Enjoy your margarita and the beach, go home. Do it again next vacation.

    • Re: (Score:3, Insightful)

      by Anonymous Coward

      Steganography? Oh, please. Copy to a usb stick, go on vacation, hand usb stick to your handler. Enjoy your margarita and the beach, go home. Do it again next vacation.

      Except most companies with sensitive data either lock out mass storage devices in USB ports, or physically block user-accessible ports. Many companies have data protection software that monitors outgoing email for flagged data (PII, sensitive data, keywords) and can scan inside attachments or block emails that they can't scan. Sending something using Steganography is one way around this.

      • And those security conscious companies allow employers to self-install applications for steganography? You can't do steganography with MS Paint. Not even with Photoshop, you need something dedicated.

    • by ArmoredDragon ( 3450605 ) on Sunday January 22, 2023 @03:01AM (#63229264)

      Copy to a usb stick, go on vacation, hand usb stick to your handler. Enjoy your margarita and the beach, go home. Do it again next vacation.

      If that's a viable option where you work, then either nothing you do is particularly sensitive, or your employer is incompetent.

    • Their spycraft was so awesome that they forgot to check if they were being followed.

  • by Arethan ( 223197 ) on Saturday January 21, 2023 @11:09PM (#63228910) Journal

    and the people out there that ascribe claims like this to xenophobia are naive, useful idiots.
    I've heard stories from my mentors and peers, and I've witnessed it try to happen myself.
    If you have a technology that's truly useful and unique, then it's worth stealing, and people will definitely try.
    That's just called human life on planet Earth.

    • Yup. The claim is xenophobic because it so clearly targets China, but is still more than likely also true.
      "World order" is the joke... the only order important to the USA is who is at the top, and it'll try to keep that by any means.

      • Name the country that is happy not being at the top, that prefers to be a second rate country.

        • by Anonymous Coward

          Name the country that is happy not being at the top, that prefers to be a second rate country.

          Russia.
          Why else would they be destroying their economy in a pointless war?

          • That's not how politics in Russia has ever worked. The government knows that they're second rate, but their power structure relies on the idea that the general populace thinks they're the most powerful in the world. The USSR broke down partly because the radioactive clouds and people getting sick and dying for no particular reason as a result of the Chernobyl incident was just too hard to cover up. That didn't stop them from trying for a week or so.

            Putin basically rebuilt that power structure by increasingl

        • Name the country that is happy not being at the top, that prefers to be a second rate country.

          Russia, apparently.

        • India. Pakistan. Australia.

          In fact, most European countries. Most Asian countries. Most African countries.
    • Comment removed based on user account deletion
  • by wakeboarder ( 2695839 ) on Saturday January 21, 2023 @11:50PM (#63228992)
    But the worst part is they don't have the know how to completely replicate the product, many times they'll sell you a half baked copy that doesn't have documentation or breaks early. A good example of this is the capacitor fiasco in the 2000s where they stole an electrolyte formula, but only half, the other half prevented the various from exploding
    • Or, they just figure they could make money by not going to the trouble of replicating the whole thing. Why would they waste the effort?
  • Parsons (Score:2, Interesting)

    by dwater ( 72834 )

    Does GE send patent payments back to Parsons for their use of his invention?
    The USA thinks it got to where it is using fair methods, but it just stomped over foreign companies and countries.
    If the USA can't secure its secrets they only have themselves blame.

    • No one in the USA thinks we invented everything by ourselves. That's just silly.
      But it is true of -all- countries that if they don't secure their knowledge it will be stolen and not only by the Chinese. What was your point? USA uniquely bad on planet?

      • No, it's just the typical whataboutism, like how a hundred or two years ago, the US was responsible for a lot of copyright and IP theft. So therefore, we apparently lost all rights forever to complain about modern, high-tech China stealing stuff from American corporations in the present. Or something.

        I don't think most people are blind enough that we don't see western countries brought a lot of this on ourselves in the rush to push all manufacturing to China to benefit from ultra-low wages. But at some p

    • Re: (Score:1, Insightful)

      Wow, more propaganda from the CCP. It is so incredibly creepy that slightest hint of anything negative about this country on social media gets stomped on by paid operatives of the CCP like you.
  • 2 years? (Score:4, Insightful)

    by GotNoRice ( 7207988 ) on Sunday January 22, 2023 @12:56AM (#63229110)
    It seems crazy to me that someone would only get 2 years in prison for stealing technology secrets. With the way our prison system works, he was probably out on probation within 6 months or less. Given the amount that he (and probably his family also) was likely paid, it would probably be worth it for most people (aka they would still do it even if they knew they would be caught and go to prison). These people should be charged with treason and sentenced to death.
    • These people should be charged with treason and sentenced to death.

      We're not at war; it can't be considered treason. The definition of treason is in the US Constitution and is rather specific.

      • by jonadab ( 583620 )
        > We're not at war

        Not under the sort of legal definition you'd have to use in a treason case, no.

        Though it's worth pointing out that the CCP *absolutely* behaves as though we either are at war, or inevitably soon will be, and they've been doing that for a long time. The school of thought for most of the last half century was that if China's economy improved, then their government would change and liberalize and become an ally; but anyone who still believes that at this point, is learning-impaired.
  • If they're Chinese and working for you, and they have family in China, they're stealing everything the Chinese government might even think about wanting.

    China is everything evil Russia is, but they're smarter and even more dedicated to creating a Big Brother surveillance society.

    • Re: (Score:2, Insightful)

      OTOH, when I read news about China on a US media I always think about this " the US does its best to prevent a serious competitor to American power from emerging". Every country do industrial spying, TBH your comment has a racist rating of 9 on 10. I leave 1 non racist point because USA and China are in a economic war so you are a victim of propaganda.
      • Glad you're here to tell me how racist something is! What would I do without you?
      • GP didn't invoke race, therefore comment wasn't racist.

        Only you invoked race, therefore you are racist.

        Race was invented so some white people could feel good about oppressing all the other people, it's not a real thing.

        • Official definition of racism according to my native langage is this: "Discrimination, violent hostility towards a human group". It fits GP perfectly. So yeah, GP post is racist to me BUT since it is an USA website, I apologize for my langage/cultural mistake and will describe GP post as xenophobic hate speech.
      • You're completely full of shit. I'd be every bit as opposed to an all white, all black or all purple society dedicated to 24-7 surveillance and control. As bad as the UK and US are, China is far worse. I suspect it's you who's the racist, since apparently you draw no distinction between China and Taiwan. Do you also lump Japan, South Korea, Vietnam and other Asian nations together?

  • China would not have half of its tech, if you didn't give it to them by outsourcing it. Yes, you. Do you think for a minute that they aren't going examine what they are making for your--and then use it in their product--to compete against yours. No, where the U.S. court cannot help you. Sorry.
  • A long and dishonourable history

    https://windeurope.org/intelli... [windeurope.org]

  • The ethos is anything benefiting Chinese people is okay. Chinese citizenship and Chinese (Han mostly) ethnicity are rarely distinguished. There isn't a lot of room to criticize given historical genocides, slavery, and also IP theft that came to pass in the growth of most empires.

    But to have an open society means not adopting surveillance state practices or intrusive restrictions on research.

    Visiting biotech postdocs of all origins routinely smuggle research to their home countries because it's their work.

    So

    • There isn't a lot of room to criticize given historical genocides, slavery, and also IP theft that came to pass in the growth of most empires.

      Sure, there is. I criticize my country, because I'm not nationalistic, and I criticize other countries too. And there's no reason not to do either, or both.

  • by DrXym ( 126579 ) on Sunday January 22, 2023 @06:20AM (#63229498)
    A US national conducted industrial espionage that benefits a foreign power, stealing designs worth millions and he gets two years? That hardly seems like adequate punishment or a deterrent to anyone else thinking of doing the same.
    • It's actually a very clever ruse, implying that they only got something useless or just half, like with the widely mentioned capacitors.
  • just get a bunch of blueprints to expensive electronics and various durable goods that require a lot of high tech and introduce a few flaws that make them work wrong and let the chinese steal them
    • Judging by the quality of products that come from China I believe this method has already been deployed.
      • by marcle ( 1575627 )

        You're living in the past. Are you old enough to remember when Japanese products were considered junk? Now they're some of the most advanced.

        The same is true about China. They're capable of very high quality. However, if you want the cheapest, they'll cut corners and do that for you too. You still get what you pay for. However, you'd be foolish to underestimate them.

        • >>> They're capable of very high quality. However, if you want the cheapest, they'll cut corners and do that for you too.

          If I had mod points, I'd give them all to you.

          "Cheap Chinese Junk" became a thing in the USA because companies were on a race to the bottom, pricewise. They couldn't get American manufacturers to build shit products (well, even shittier than American manufacturers were already building) because of product safety laws, customer safety laws, and functioning Court systems, but they

  • I know, from working for another branch of GE, that GE IT locks down its systems in many ways to prevent export of files. USB ports get blocked, for example. Email can still be sent, but all of it is examined and tracked. And you can't go to a website and upload files, as such. So there is no obvious way to simply send a 'classified' file out. So it makes sense this guy used steganography, but GE IT is not stupid and they probably have ways to detect things in innocuous-appearing files.
    • My company has a similar approach to IT security. There's nearly always a hole somewhere if you know where to look and what to do. We have a company come in every year or so to test our security. We always pass.

      I got written permission from my higher-ups to "explore" smuggling out sensitive files. Their attitude was; "Yeah, sure, old guy. Good luck." I successfully "stole" several multi-megabyte files containing sensitive data, using one of our regular unmodified desktops. Sent them right through their loc

    • by jonadab ( 583620 )
      As evidenced by the fact that he got caught (but I could've told you anyway), steganography by itself is not a reliable way to evade detection. At minimum you want to combine encryption with steganography, and that still leaves you vulnerable to things like surveillance logging.

      This is a general principle in security: effective security is almost never made out of just one technique. Good security systems have multiple components, pieced together in such a way that allows them to cover one another's weak
  • US/UK pointing fingers on trying to get secrets from others is being the biggest hypocrites in the world. Yeah China will try to steal secrets, just as the US or UK is. And with the US bullying other countries in not selling technology to China it just justifies why China is doing it. BUT, don't underestimate the chinese in being very capable of doing their own advanced research, as it IS one of the reasons why the US does the bans, as the US is falling behind. Just look for instance at hypersonic weapons,
  • Comment removed based on user account deletion
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