- The Washington Times - Monday, February 10, 2020

The U.S. has indicted four members of China’s military for hacking credit reporting giant Equifax in 2017 and stealing data on more than 145 million Americans, the Justice Department said Monday.

The accused Chinese hackers plundered names, birth dates and Social Security numbers of nearly 150 million Americans and the driver’s licenses of more than 10 million Americans, according to the nine-count indictment handed down by a grand jury in Atlanta.

Attorney General William Barr said the volume of information compromised was “staggering” and the largest breach in U.S. history.

“This theft not only caused significant financial damage to Equifax but invaded the privacy of many, millions of Americans and imposed substantial costs and burdens on them as they had to take measures to protect themselves from identity theft,” said Mr. Barr.

The defendants named in the indictment were Wu Zhiyong, Wang Qian, Xu Kei, and Liu Lei, who are members of the People’s Liberation Army 54th Research Institute. China’s U.S. embassy did not comment on the charges at presstime, and the issue did not come up in the daily briefing Monday of the Foreign Ministry spokesman in Beijing.



None of the four are in custody and officials acknowledged there is little chance they will appear in a U.S. courtroom. The U.S. does not have an extradition agreement with China.

Still, the indictment puts international law enforcement on notice and subjects the defendants to potential arrest if they leave China.

“We can’t take them into custody, try them in a court of law, and lock them up — not today anyway. But one day these criminals will slip up and when they do, we’ll be there,” said FBI Deputy Director David Bowdich.

Equifax disclosed the breach in 2017. Last year, it agreed to a $700 million settlement with the Federal Trade Commission to compensate victims. The hack also spurred a series of congressional hearings and the resignation of Equifax Chief Executive Officer Richard Smith.

The hackers broke into the Equifax’s computer systems by exploiting a security weakness. Once inside, they spent weeks conducting reconnaissance to crack the database behind the website. During that process, the hackers made more than 9,000 queries to capture U.S. citizens’ data, U.S. investigators say.

The hackers painstakingly hid their tracks, routing their web traffic from the compromised Equifax servers through 34 separate servers and 20 countries, according to prosecutors.

The four Chinese military agents were charged with conspiracy, economic espionage, wire fraud and unauthorized access and intentional damage to a protected computer.

It was the second time the U.S. brought hacking charges against members of the Chinese military.

The last time was in 2014 when the Obama administration charged five hackers with breaking into several major American corporations’ computer systems and pilfering trade secrets.

Mr. Barr said the Justice Department does not normally charge other countries’ military or intelligence officers outside the United States. But he said the size and scale of the Equifax data breach — and the havoc it caused for victims — “cannot be countenanced.”

The case comes as the Trump administration ramps up its warnings about the growing theft by Beijing to steal American scientific research and innovation. Roughly 80% of economic espionage cases brought by the Justice Department implicate China and 60 % of all trade secret cases involve the Chinese in some way, said Mr. Barr.

“This kind of attack on American industry is of a piece with other Chinese illegal acquisitions of sensitive personal data,” he said. “For years we have witnessed China’s voracious appetite for the personal data of Americans.”

Mr. Barr warned last week of China’s efforts to control the emerging fifth-generation 5G information networks around the globe, saying the U.S. and private industry must act quickly to avoid putting their economic fate in China’s hands.

In January, federal officials brought separate charges against three individuals — including the chairman of Harvard’s chemistry faculty and two Chinese nationals — for allegedly helping China pilfer U.S. research.

Sen. Mark Warner of Virginia, the ranking Democrat on the Senate Intelligence Committee, praised the department for bringing charges against the Chinese Equifax hacking team.

But he called on the Trump administration to push harder against Beijing’s economic espionage in its trade deals with the country.

“For years, the Chinese government has targeted Western commercial firms. It is disappointing that despite a lot of rhetoric, President Trump’s recent agreement with China does nothing to address this specific issue,” said Mr. Warner.

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