Systemic Chinese hacking undermines U.S. R&D, innovation

Legendary spook Richard A. Clarke's gone on the record claiming Chinese hackers have infiltrated every major American corporation. He warns that the effects for American innovation--and especially corporate R&D--will be brutal.

Counterterrorism guru Richard A. Clarke has publicly admitted a bit of an open secret: Every major corporation in the United States has been infiltrated by Chinese hackers. Clarke, who now heads risk management firm Good Harbor Consulting, told journalist Ron Rosenbaum that Chinese hackers have been systematically stealing trade secrets from American firms on behalf of Chinese and foreign companies. While this has been known for a long time, Clarke's admission was made in shockingly blunt language.

In the interview, published in Smithsonian magazine, Clarke states that ?I?m about to say something that people think is an exaggeration, but I think the evidence is pretty strong--every major company in the United States has already been penetrated by China.? Clarke also alleges that Chinese hackers stole details about the manufacture of the F-35 fighter bomber, and that America's tech supply chain for chips, routers, and hardware may be infected with Chinese logic bombs, trapdoors, and Trojans waiting to be activated at a future date.

One of Clarke's greatest fears is a ?death of a thousand cuts? for American innovation, and of a situation where R&D secrets from large corporations are systematically stolen by Chinese and foreign hackers. Not coincidentally, Good Harbor boasts an extensive cybersecurity department providing boutique enterprise safety services.

Over the past year, as cyberwarfare has become more commonplace--which encompasses everything from Anonymous' crowdsourced DoS attacks to sophisticated American, Chinese, Israeli, and Russian cyberespionage--there has been an increased willingness by experts to go on the record about these sorts of things. Several months ago, Fast Company spoke with Adam Segal of the Council on Foreign Relations about ?The Chinese Way of Hacking.?

For more stories like this, follow @fastcompany?on Twitter. Email Neal Ungerleider, the author of this article, here?or find him on Twitter?and?Google+.

[Image: Wikipedia user Aude]

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