Lawmakers say that China's reported use of a microchip to target tech giants like Amazon and Apple shows the 'lengths that Beijing will go to in order to steal' America's secrets

Xi Jinping

Bloomberg reported Thursday that Chinese officials were able to slip malicious microchips onto motherboards used by the US government and American tech giants, including Apple and Amazon.
While the companies strongly denied the report, lawmakers in both the House and Senate said that they were looking closely into the allegations.
Lawmakers also told Business Insider that the report is another example of China's sustained campaign to infiltrate the US and steal industrial and political secrets.

The Chinese government's reported attempts to target major tech companies with malicious hardware drew a sharp rebuke from lawmakers in Washington who said it was the latest example of China's aggression towards the US.

A Bloomberg Businessweek report Thursday alleged that Chinese government officials were able to slip tiny microchips into hardware from Supermicro, a major motherboard supplier, which could then swipe information from affected data centers. According to the report, the tainted Supermicro motherboards were used by the US government and tech giants like Amazon and Apple.

While the companies strongly denied the report, lawmakers said it was another example of China's sustained efforts to gain access to the US's security and technological secrets.

Rep. Adam Schiff, the highest-ranking Democrat on the House Intelligence Committee, told Business Insider that the report was "deeply disturbing."

"The report that China sought to infiltrate the computer chip supply chain, if true, is deeply disturbing and the latest example of the lengths that Beijing will go to in order to steal America's official and commercial secrets," Schiff said in a statement. "For many years, the House Intelligence Committee has been deeply concerned about the potential for Chinese intrusion into our supply chain and has been looking at the problem as part of the Committee's ongoing ‘deep dive’ into China."

Sen. Mark Warner, the top Democrat on the Senate Intelligence Committee, echoed the sentiment in a statement to Business Insider.

"This report provides more evidence that China’s pattern of behavior is a serious threat to national security and supply chain risk management," Warner said.

Lawmakers on Capitol Hill have been critical of Chinese technology. Earlier in the year, members criticized the Trump administration's deal to ease sanctions imposed on Chinese phone maker ZTE. The company was hit with crippling sanctions after the US determined it did business in Iran and North Korea, a direct violation of US sanctions on those countries.

The Pentagon also banned the sale of ZTE and fellow Chinese phone maker Huawei's devices on military bases, due to concerns that information on their devices could be accessed by Beijing. Likewise, the Democratic National Committee warned candidates running for office in November's midterms not to use ZTE phones on the trail.

While attempts to strengthen sanctions on ZTE in Congress came up short, a handful of bipartisan senators introduced a bill to ensure the company will be whacked with harsh penalties if it violates the terms of the Trump administration's probation.

Sen. Elizabeth Warren, one of the cosponsors of the new ZTE bill, said that the report showed that the US should focus on producing more high-tech products in the US rather than relying on Chinese manufacturers.

"China’s repeated attempts to compromise our national security and damage our economy by stealing intellectual property and corrupting the technology supply chain must stop," Warren said. "We should be taking aggressive steps to make this kind of critical hardware here in the United States, rather than importing it from foreign competitors like China."

A spokesperson for Sen. Marco Rubio, another cosponsor of the ZTE bill and a particularly vocal critic of China, told Business Insider that while the senator is still reviewing Bloomberg's story, Rubio is very worried about the Chinese efforts to confront the US.

"Marco has long warned that China is manipulating its entire society, including the Chinese technology sector, in an aggressive and long-term effort to harm our national security and economy," the spokesperson said.

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