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CYBER WARS
China's PLA controls hackers: US IT security firm
by Staff Writers
Washington (AFP) Feb 19, 2013


China military rejects hacking allegations
Beijing (AFP) Feb 20, 2013 - China's defence ministry Wednesday rebuffed a report linking its People's Liberation Army to sophisticated cyberattacks on US firms, saying there was no internationally agreed definition of hacking.

The 74-page analysis by the American Internet security firm Mandiant provided one of the most detailed accounts of large-scale hacking operations that many Western experts have long believed receive official Chinese support.

Security was stepped up at the 12-storey office building in Shanghai identified by Mandiant as the headquarters of the military cyberspying Unit 61398, with officers temporarily detaining journalists in the area.

Defence ministry spokesman Geng Yansheng said in a statement that Mandiant's claims had "no factual basis" and insisted there was no consensus on what qualified as hacking.

"There has been no clear internationally agreed definition for 'cyber attacks'," he said, adding that the report "subjectively deduced" that online activities amounted to cyberspying.

He reiterated previous arguments by Beijing officials that attacks traced to Chinese IP addresses did not necessarily originate in the country.

"Cyberattacks are by nature transnational, anonymous and deceptive, and the origin of attacks is highly uncertain," he said.

"It's widely known that using stolen IP addresses to carry out hacking attacks is happening practically every day."

In its report, Mandiant alleged the hacking group "APT1" -- from the initials "Advanced Persistent Threat" -- was a branch of Unit 61398 and had stolen hundreds of terabytes of data from at least 141 organisations across 20 industries.

The US said in response to the document that it regularly raises hacking concerns with China, with State Department spokeswoman Victoria Nuland saying it comes up "in virtually every meeting we have with Chinese officials".

At a regular press briefing on Wednesday, China's foreign ministry spokesman Hong Lei did not respond directly to a question about whether Washington had discussed the issue with Beijing.

He said instead that both sides "have maintained communication" and referred reporters to the defence ministry statement.

Security outside the building in Shanghai's northern suburb of Gaoqiao that was said to house the military-led hacking group was tightened Wednesday after it became the object of media attention.

An AFP photographer was detained for half an hour while shooting video outside the complex, while another international news agency photographer was also briefly held.

Six Chinese soldiers in uniform pulled the AFP photographer out of a car and brought him to the guardhouse, where they searched his bag and seized his camera's memory card before allowing him to leave with a warning.

Speaking in English, the apparent leader of the group told him no photography was allowed since it was a military installation.

China's army controls hundreds if not thousands of virulent and cutting-edge hackers, according to a report Tuesday by a US Internet security firm that traced a host of cyberattacks to an anonymous building in Shanghai.

Mandiant said its hundreds of investigations showed that groups hacking into US newspapers, government agencies, and companies "are based primarily in China and that the Chinese government is aware of them".

The 74-page report focused on one group, which it called "APT1" from the initials "Advanced Persistent Threat". The New York Times, citing experts, said the group was targeting crucial infrastructure such as the US energy grid.

"We believe that APT1 is able to wage such a long-running and extensive cyber espionage campaign in large part because it receives direct government support," Mandiant said.

The group, it said, was believed to be a branch of the People's Liberation Army called Unit 61398, and digital signatures from its cyberattacks were traced back to the direct vicinity of a nondescript, 12-story building on the outskirts of Shanghai.

"We believe the totality of the evidence we provide in this document bolsters the claim that APT1 is Unit 61398," it said, estimating it is "staffed by hundreds, and perhaps thousands of people".

China's defense ministry said its army had never supported any kind of hacking activity.

"Not only are reports that China's army has been involved in hacking unprofessional, they do not fit with the facts," the ministry said in a statement to AFP.

"Hacking attacks are a global problem. Like other countries, China also faces the threat of hacking attacks, and is one of the main countries falling victim to hacking attacks."

The country's foreign ministry rejected "groundless accusations" of Chinese involvement in hacking and also said China was itself a major victim, with most overseas cyberattacks against it originating in the US.

The Pentagon declined to comment directly on the report but said Defense Secretary Leon Panetta had voiced US dismay over digital threats in his visit to Beijing last year.

"We have repeatedly raised our concerns at the highest levels about cyber theft with senior Chinese officials, including the military, and we will continue to do so," spokesman George Little told reporters.

A series of brazen IT attacks on America's most high-profile media outlets, reported by The New York Times and the Wall Street Journal, as well as on Twitter and others, have revived concerns over Chinese hackers.

The Times said hackers stole its corporate passwords and accessed the personal computers of 53 employees after the newspaper published a report on the family fortune of China's Premier Wen Jiabao.

Clients including The Times have hired Mandiant to clean up their systems after cyberattacks.

In its report, Mandiant alleged that APT1 -- known also as "Comment Crew" for its practice of planting viruses on the comment sections of websites -- has stolen hundreds of terabytes of data from at least 141 organizations spanning 20 industries.

The Times, which was given early access to the report, said the researchers had found that the Comment Crew was increasingly focused on companies involved in US infrastructure, including in its electrical power grid, gas lines and water works.

One target, the newspaper reported, was a company with remote access to more than 60 percent of oil and gas pipelines in North America.

In his State of the Union address last week, US President Barack Obama said the potential ability of outsiders to sabotage critical US infrastructure was a major concern.

"We cannot look back years from now and wonder why we did nothing in the face of real threats to our security and our economy," he said.

The building pinpointed as the hacking HQ sits in Shanghai's northern suburb of Gaoqiao, near a petrochemical complex and surrounded by small shops.

There is no name plate outside, but framed posters showing soldiers are displayed on a high wall surrounding the complex, while the Chinese PLA's symbol of a red star is mounted over the main door of the building.

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