China’s spy agency warns foreign groups are using consulting ‘as a cover’ to steal secrets

Beijing says overseas consultancies have tried to steal classified state and commercial information, posing ‘major risks to national security’
The warning comes after several international consulting companies in China were targeted in raids last year

China’s Communist Party

Vanessa Caiin Shanghai

Published: 5:18pm, 28 Mar 2024

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China’s top counter-espionage agency warned that overseas entities have obtained commercial and state secrets under the guise of consulting as Beijing pushes to alert professionals to risks amid a sweeping national security drive.

In a post on its official WeChat account on Thursday, the Ministry of State Security said that overseas spy agencies had used consulting activities “as a cover” for their attempts to steal classified information, posing “major risks to national security”.

The article was accompanied by a six-minute video, which the ministry said was based on a real case where overseas agencies instructed a consulting company to steal classified information from a Chinese company that wanted to invest abroad.

In the video, a man travels in time to remind his past self to stay alert and avoid leaking information related to the economy, technology and military to the consultancy.

China warns foreign hackers are infiltrating business and government networks

Over the past year, the state security ministry has become more active on social media to warn about the threat from foreign spies and call on the public to share information about suspicious activity.

The country’s revised counter-espionage law, which came into effect in July 2023, expands both the definition of spying and the investigative powers of national security agencies.

The newly amended state secrets law, effective from May, adds a dozen new clauses that expand the depth and reach of its coverage.

The ministry said the overseas consultancy conducted a comprehensive review of the Chinese company with the stated purpose of assisting its overseas listing, but used the process to gain access to core data and state secrets.

It said the consultancy persuaded staff at the company to answer questions about classified information, inquired about unauthorised classified files and recorded classified information about core products.

“Such information, if accumulated to a certain extent and analysed in a comprehensive manner, can reflect important information about our economic operation, national defence and military, which are important targets coveted by overseas espionage and intelligence agencies, and once leaked, will seriously endanger national security,” the ministry said.

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The ministry warned that such activities amounted to illegally obtaining commercial secrets for “the containment and suppression of China’s advantageous industries”.

These activities aim to spy on and steal China’s core secrets, acting as “an accomplice” in espionage, infiltration and instigation, the ministry added.

Without naming the overseas consultancy that inspired the video, the ministry said its illegal activities were being watched and state security agencies had “acted decisively, blocking the channels of leakage of core data in a timely manner”.

Last year, several foreign consulting companies were targeted in raids. In April, local police questioned staff at US consultancy Bain & Company’s Shanghai office. In May, authorities raided international consulting firm Capvision.

The ministry emphasised that under the counter-espionage law, the definition of espionage is not limited to working directly with spy agencies and their surrogates but can also include working with other groups to leak state secrets.

Last week, the ministry warned that the networks of “hundreds” of Chinese business and government units had been infiltrated by an overseas hacking group, and urged citizens to step up cybersecurity.