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news.com.au: Chinese fury at cyber spy claims

By Rowan Callick and Jane Macartney
December 07, 2007 12:13am
From The Australian

CHINA issued a furious response to reports that Chinese agencies are spying on international companies using the internet.

China has been accused of running international cyber-espionage rings that have gained access to strategic corporate and defence information from countries including Australia, Britain, Germany, India, New Zealand and the US.

But the claim, apparently backed up by Britain’s MI5 spy chief Jonathan Evans, has been strenuously denied by Beijing.

Other experts on hacking have cast doubt on the chief source of the accusation, a report by Californian security software seller McAfee.

The McAfee report says about 120 countries are developing cyber attack strategies, but that China is believed responsible for 80 per cent of the most damaging attacks on government targets this year.

A report in The Times says: “Chinese-backed computer hackers broke into the internal computer network of Rolls-Royce in an attack that a security source said ‘nearly took them out’.”

The report claimed: “Chinese nationals working for Shell were preyed upon by state-backed operatives hoping to obtain pricing information for its operations in Africa.”

The MI5 chief sent a letter to 300 chief executives and security heads in banks and accounting and law firms warning them they were under attack from “Chinese state organisations”.

The letter contains advice on how to identify Chinese “Trojans” – emails that contain software capable of hacking into a computer network and feeding back confidential data.

Insurance company Lloyds warned in a separate report: “The business community urgently needs to close the gap between growing awareness of the risk, and a lack of understanding of what it means in practice.”

China’s Foreign Ministry spokesman, Liu Jianchao, responded: “China has also been attacked by hackers of other countries, so the Government attaches great importance to and participates in the international law enforcement co-operation in this area.”

His colleague, Qin Gang, said the newspaper report was “very irresponsible”, and that it attempted to place obstacles in the way of improved ties between Britain and China.

Oo Gin Lee, of Singapore’s Digital Life magazine, said the McAfee report was not based on its own research, but was commissioned from academics and security experts.

“The main allegations against China were not based in some careful study of data packets or internet traffic but on previous press and web reports,” he said.

The information, for instance, that India’s National Informatics Centre was “reportedly attacked from dial-up internet connections in China” came from the personal blog of a “security expert” – Benny Ketelslegers, who warned: “I make no garanties (sic) as to the accuracy, validity, relevance or importance of anything I say here.”

But another Californian company, Finjan, that sells internet security products, this week issued an interim update on a report it is researching, that backs up some of McAfee’s claims.

Finjan says its “malicious code research centre” has detected “malicious activity by groups that distribute their content using obfuscated code and a network of websites to bypass traditional information security technology”.

It says it “investigated a very sophisticated attack that used new hacking techniques and discovered a centralised group of activity based from China, and one of the websites in the group belongs to a Chinese government office”.

The use of “Trojans”, it concludes, “is disturbing for governments, enterprises and individuals alike”.

http://www.news.com.au/story/0,10117,22884157-401,00.html?from=public_rss

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