Commercial, IIOT, IIOT Aerospace, Military

Spies in China Conspired to Steal Aerospace Companies’ Intellectual Property

By Woodrow Bellamy III | November 2, 2018
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Capstone Turbine Corp., a California-based gas turbine manufacturer, was the only company named in an unsealed indictment published by the U.S. Department of Justice, showing how Chinese intelligence officers conspired to steal intellectual property and data from aerospace companies based in the United States and Europe. Photo courtesy of Capstone Turbine Corp.

The U.S. Department of Justice (DOJ) is charging 10 Chinese intelligence officers and co-conspirators with conspiracy to steal data and intellectual property from aerospace companies based in the United States and Europe between 2010 and 2015.

DOJ’s office of public affairs this week unsealed an indictment describing an elaborate scheme conducted by intelligence officers working for the Jiangsu Province Ministry of State Security (JSSD), a foreign intelligence arm of the People’s Republic of China’s Ministry of State Security (MSS). The indictment says the intelligence officers were attempting to steal information related to turbofan engine technology used on commercial airliners between January 2010 and May 2015.

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During that same time period, a Chinese state-owned aerospace company was developing an engine also designated for use in commercial aircraft being developed in China. Though DOJ did not reference those development programs by name, the Commercial Aircraft Corp. of China (COMAC) has been developing the C919 and ARJ21 passenger jets over the past decade and had sought international airworthiness certification. Both aircraft are powered by Western-built engines, components and flight control technologies.

“The threat posed by Chinese government-sponsored hacking activity is real and relentless,” said John Brown, FBI special agent in charge of the San Diego Field Office.

According to the indictment, Chinese hackers working under the guidance of JSSD targeted a total of 13 different companies, including two aerospace firms based in the U.K., a French aerospace manufacturer that also has an office in China’s Suzhou, Jianqsu province and an aerospace company based in Australia.

All of the other unnamed companies had offices and facilities based throughout the United States, including Arizona, Massachusetts and Oregon.

Los Angeles, California-based gas turbine manufacturer Capstone Turbine was the only company identified by name in the indictment. DOJ officials described how hackers employed by JSSD officials used a variety of methods including spear phishing, malware and watering hole attacks to access data and information on computer networks used by Capstone and the other companies.

The indictment is the third of its kind announced by DOJ since September. Another incident involved a Chinese national from Belgium attempting to steal trade secrets from several U.S. military jet engine suppliers, including GE Aviation.

“State-sponsored hacking is a direct threat to our national security. This action is yet another example of criminal efforts by the MSS to facilitate the theft of private data for China’s commercial gain,” said U.S. Attorney Adam Braverman.

This story originally appeared in sister publication Avionics International.

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