90 Miles From Tyranny : McCaul: U.S. Pushing Back on Chinese IP Theft and Global Aggression

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Friday, May 10, 2019

McCaul: U.S. Pushing Back on Chinese IP Theft and Global Aggression

The United States is finally pushing back against the mounting threats from China, including intellectual property theft, global expansion through coercive economics, and the attempted takeover of the South China Sea, a senior Republican member of Congress says.

Members of Congress in particular, from both parties, are waking up to the problem, said Rep. Michael McCaul (R., Texas), senior Republican on the House Foreign Affairs Committee.

"A lot of this has been under the radar and a game of deception, and I think a lot of members of Congress are starting to wake up to the fact this is a serious threat to the national security of the United States," he said in an interview with the Washington Free Beacon.

McCaul was chairman of Homeland Security Committee until 2017 and said he is well versed in Chinese cyberattacks through that experience. Those attacks involved the massive theft of American intellectual property from both government and private sector computer networks.


One of the most damaging attacks involved Chinese hackers stealing 22 million federal employee records, including millions with access to classified information. Security officials say the Chinese are using the stolen records for both cyber espionage and human intelligence-gathering efforts.

McCaul said several recent federal indictments of Chinese hackers are important steps in pushing back against the Chinese cyberattacks. "For the first time, you're seeing consequences to China's bad behavior when it comes to [intellectual property] theft," he said.

related: U.S. Indicts Two Chinese Nationals Over Global Hack Campaign

Prosecutors in Indiana on Wednesday indicted Wang Fujie, a member of what was described as a sophisticated Chinese hacker group that carried out the 2015 cyberattack against the healthcare provider Anthem that involved the theft of more than 60 million health records.

Curbs on China's data theft also are part of the ongoing U.S.-China trade negotiations, as the Trump administration seeks Beijing's agreement to stop illicit Chinese technology transfer.

McCaul also recalled how China sought to steal the 1996 election by funding Bill Clinton's re-election campaign. McCaul, a former Justice Department prosecutor, worked on the case of Johnny Chung, a California businessman who funneled more than $366,000 in funds to the Democrats, including money provided secretly by the People's Liberation Army intelligence service for the Clinton reelection campaign.

related: Justice Department accuses Chinese spies of hacking into dozens of US tech and industry giants

"I remember when I was in the Justice Department I prosecuted the Johnny Chung case and I saw what China was doing to steal our technology, and in fact our election," he said.

"The director of Chinese intelligence put money through China Aerospace into Chung's bank account, and he put it in to the Clinton campaign."

The election meddling operation involved PLA Gen. Ji Shengde, head of military intelligence. According to Chung's congressional testimony in 1999, the Chinese general told him "we like your president very much. We would like to see him reelected. I will give you 300,000 U.S. dollars. You can give it to the president and the Democrat Party." Chung would pleaded guilty to bank fraud, tax evasion, and campaign financial violations.

Investigators traced Chung's PLA connections to Lt. Col. Liu Chaoying, an executive at China Aerospace International Holdings, the Hong Kong-based subsidiary of China Aerospace Science and Technology Corp, a government space launch and missile manufacturer. Liu introduced Chung to Ji.

More recent Chinese election meddling surfaced in October. Vice President Mike Pence said in a speech that China is engaged in a comprehensive and coordinated campaign to undermine support for the president. "China wants a different president," Pence said Oct. 5.

McCaul said a recent example of Chinese technology theft involved the firing of three Chinese academics from the University of Texas MD Anderson Cancer Center in Houston last month. The center is a leader in immunotherapy.

"We're seeing a systemic [operation] across the United States," McCaul said of China's effort to obtain U.S. medical research and development information. "I think you're going to see indictments coming down in the future. And it's not just limited to MD Anderson. It's going to be all over the...

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