Published: Fri, October 05, 2018
Finance | By Gustavo Carr

China accused of planting spy chips in Pentagon computers

China accused of planting spy chips in Pentagon computers

Elemental Technologies had national security contracts and servers similar to the one that Amazon tested were in data centers belonging to the Department of Justice, on Navy warships, and in systems used to control Central Intelligence Agency drones, according to the Bloomberg report. The company explains that it conducted "rigorous internal investigations" each time it was contacted by the publication, and that it never found anything substantiating the claims.

But it said a top-secret United States government investigation, dating from 2015 and involving the FBI, remains open.

"We are deeply disappointed that in their dealings with us, Bloomberg's reporters have not been open to the possibility that they or their sources might be wrong or misinformed", Apple said, in part.

An explosive new report has accused Chinese military operatives of managing to implant tiny surveillance microchips into the motherboards of servers used by dozens of major American companies including Amazon and Apple in a scheme worthy of a best-selling spy novel. "This is untrue", Amazon said in a blog post.

"We must hear directly from the companies potentially affected by this devastating security breach to get a better understanding of what happened", he said.

American companies design and sell leading technology products, such as servers, laptop computers and smartphones, but they are built and assembled largely in China.

The Chinese government has denied allegations of state-sponsored hacking of US companies.

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U.S. officials long have anxious about the potential for altered microchips or other components to be secretly inserted into products and shipped to the United States and elsewhere, opening doors to long-term spying on computer users and their information networks.

A new report claims that Chinese intelligence added microchips into computers produced in that country.

Investigators found that tiny microchips, not much bigger than a grain of sand, had been inserted during manufacturing in China onto equipment made by subcontractors of Super Micro Computer Inc., one of the world's biggest suppliers of server motherboards, the fiber-mounted clusters of chips and capacitors that act as neurons of data centers.

The report said that dozens of companies may have used sabotaged servers in their data centers before the Chinese operation was detected. "Apple has never found malicious chips in our servers". Apple never had any contact with the Federal Bureau of Investigation or any other agency about such an incident.

Super Micro told Bloomberg: "While we would cooperate with any government investigation, we are not aware of any investigation regarding this topic nor have we been contacted by any government agency in this regard".

As we shared with Bloomberg BusinessWeek multiple times over the last couple months, at no time, past or present, have we ever found any issues relating to modified hardware or malicious chips in SuperMicro motherboards in any Elemental or Amazon systems.‎. "If it is the case, then government procurements from other countries like Europe, the U.S. and Dubai - Lenovo's servers - will drop substantially because of national security".

"But I will say the Chinese efforts to threaten us in cyberspace and across the information technology spectrum are a very high priority for us - countering them, establishing structures of deterrence to prevent China from even thinking about doing it, touches on the offensive cyber operations that the president has authorized", Bolton said.

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