MI5 warns of growing Chinese cyberspace spy threat

Such information is then delivered to the Chinese company to strengthen its hand during negotiations.

It is one thing for us to write about this systemic theft campaign, and another thing for Jonathan Evans, director of U.K. spy agency MI5 to write about, which he has. Indeed, the U.K. government now openly accuses China of carrying out state-sponsored espionage against vital parts of Britain’s economy, including the computer systems of big banks and financial services firms. The London Times reports that in an unprecedented alert, the director-general of MI5 sent a confidential letter to 300 chief executives and security chiefs at banks, accountants, and legal firms last week warning them that they were under attack from “Chinese state organizations.” As far as we can tell, this is the first time that the U.K. government has directly accused China of involvement in Web-based espionage. Such a blunt and explicit warning from Jonathan Evans could have serious diplomatic consequences and cast a shadow over Gordon Brown’s first official visit to China as prime minister early in the new year.

A summary of the MI5 warning, a copy of which has been seen by the Times, was posted on a secure government Web site. It says that Evans wrote to business leaders “warning them of the electronic espionage attack.” The summary, on the Web site of the Center for the Protection of the National Infrastructure, says: “The contents of the letter highlight the following: the Director-General’s concerns about the possible damage to U.K. business resulting from electronic attack sponsored by Chinese state organizations, and the fact that the attacks are designed to defeat best-practice IT security systems.” It adds: “The letter acknowledges the strong economic and commercial reasons to do business with China, but the need to ensure management of the risks involved.”

Note that access to the site is limited to groups which are part of the country’s critical infrastructure, which include telecoms firms, banks, and water and electricity companies. The document gives warning that British companies doing business in China are being targeted by the Chinese Army, which is using the internet to steal confidential commercial information. The Home Office refused to comment last night on what it called leaked private correspondence. Martin Jordan, a principal adviser at the accountants KPMG, who has seen the contents of the letter, said: “If the Chinese know that a British firm is trying