Espionage sponsored by the Chinese government has resulted in "brazen and wide-scale theft of intellectual property of foreign commercial competitors," said Representative Mike Rogers, chairman of the U.S. House of Representatives Permanent Select Committee on Intelligence.
Espionage targeting other nations' military and government secrets has been common for centuries, but the Chinese government is conducting a "massive trade war" on other countries by targeting private businesses, said Rogers, a Michigan Republican.
"I don't believe that there is a precedent in history for such a massive and sustained intelligence effort by a government to blatantly steal commercial data and intellectual property," he said during a committee hearing. "China's economic espionage has reached an intolerable level and I believe that the United States and our allies in Europe and Asia have an obligation to confront Beijing and demand that they put a stop to this piracy."
A representative of the Chinese embassy in Washington, D.C., denied Rogers' allegations. "As my government has seriously and repeatedly pointed out, allegations of China conducting cyberspace espionage are unwarranted and irresponsible," spokesman Wang Baodong said. "As a victim of international cyberspace hacking activities, China is firmly against such criminal acts, and it has been working hard together with the international community for a more secure cyberspace. Facts should be respected, and accusations against China should be stopped."
Rogers wasn't the only speaker at the hearing to criticize the Chinese government. The U.S. is "being attacked in an aggressive way" by China and possibly other countries, said Representative Dutch Ruppersberger of Maryland, the senior Democrat on the committee.
Michael Hayden, former director of the U.S. National Security Agency (NSA) and the U.S. Central Intelligence Agency, agreed. "As a professional intelligence officer, I step back in awe of the breadth, the depth, the sophistication, the persistence of the Chinese espionage effort against the United States of America," said Hayden, now with security consulting firm the Chertoff Group.
During the hearing, lawmakers questioned Art Coviello, executive chairman of RSA Security, about the breach of his company's SecurID authentication product earlier this year. Coviello described the type of phishing and social engineering attack that led to the compromise as being "very, very sophisticated" and previously unseen by investigators.
Rogers asked if thieves who pulled off the RSA attack were likely sponsored by another nation. "Our conclusion -- especially in our discussions with law enforcement -- is that this could not have been perpetrated by anyone other than a nation state," Coviello said.
Asked for suggestions on improving U.S. cybersecurity, Coviello called on Congress to pass a national data breach notification law, and he called on the U.S. government to share more information about cyberattacks with private companies. A quicker method of sharing information between the government and businesses is needed, he said, because in a large majority of successful cyberattacks, businesses don't know they were breached until the U.S. Federal Bureau of Investigation or some other third party tells them.
In the past 50 cyberattacks investigated by cybersecurity firm Mandiant, 48 of the victims didn't know they were compromised until an outside organization told them, said Kevin Mandia, Mandiant's CEO.
Coviello also called on Congress to give the NSA more power to stop cyberattacks on U.S. companies. The NSA has the expertise but it has limited authority to act inside the U.S., witnesses said.
There's a "lack of clarity" among the U.S. public about what resources the government should use to battle cyberattacks, Hayden added. "We have capabilities sitting on the sideline because we are not yet sure how to appropriately use them in this new domain," he said. "We, the American people, have not yet established the rules of the road for what it is we want the government to do in the cyberdomain, or what we will allow the government to do."
A huge, unresolved debate affecting cybersecurity is the right of privacy, Hayden added. "We don't have anything approaching a national consensus when it comes to what constitutes a reasonable expectation of privacy on the Internet," he said.
Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's e-mail address is email@example.com.