Congress accuses Chinese tech giants of un-American activities

Huawei and ZTE are two giant Chinese tech companies frequently targeted by accusations of industrial espionage, intellectual property theft, and even providing backdoors for network attacks to the Chinese military. Now, the two are the focus of a House Permanent Select Committee on Intelligence report issued today. The report finds that the two companies "cannot be trusted to be free of foreign state influence and thus pose a security threat to the United States and to our systems."

Huawei is a $32 billion networking and data center infrastructure company; ZTE provides both telecommunications infrastructure and cellular handsets. Both have been frequently accused of having close ties to the Chinese government and to the People's Liberation Army (China's military).

Those connections got Huawei banned from bidding on Australia's national broadband effort. Now, members of the House Permanent Select Committee on Intelligence are calling for the White House and the rest of Congress to take action. The committee wants to place broad-ranging restrictions on the activities of the companies because of the potential threat their hardware could pose if it was used for "cyber-espionage" or attacks on infrastructure. They're urging US telecommunications companies and other network providers to avoid the two companies and "seek other vendors for their projects."

For now, Huawei and ZTE have proposed a technical solution to the security questions concerning their hardware. In the United Kingdom, Huawei's hardware and software is independently tested by the Cyber Security Evaluation Centre (and by technicians with government security clearances) before it is authorized for use in the national telecommunications infrastructure. The Select Committee's investigation did not delve into the security of any of ZTE's hardware or software products—"the expertise of the Committee does not lend itself to comprehensive reviews of particular pieces of equipment," as the report noted. But the Select Committee's report challenges that approach, saying that evaluating individual components would "provide a sense of security," but a false one. "The task of finding and eliminating every significant vulnerability from a complex product is monumental. If we also consider flaws intentionally inserted by a determined and clever insider, the task becomes virtually impossible."


http://arstechnica.com/tech-policy/2012/10/congress-accuses-chinese-tech-giants-of-un-american-activities/