Oct 6, 2012 07:29 AM
Report: Huawei, ZTE possibly involved in espionage for China
Representative Mike Rogers (R-MI) and C.A. Ruppersberger (D-MD) are preparing to issue a report October 8 on a year-long investigation of smartphone and equipment manufacturers Huawei and <a href="http://macnn.com/rd/269912==http://www.electronista.com/articles/12/08/30/zte.huawei.links.to.chinese.government.probed/" rel='nofollow'>ZTE Corp</a>. The US House Permanent Select Committee on Intelligence has been examining whether the companies' expansion in the US market enables Chinese governmental espionage and endangers the telecommunications infrastructure of North America.<br><br>US companies in business transactions with Huawei should "find another vendor if you care about your intellectual property, if you care about your consumers' privacy, and you care about the national security of the United States of America," Representative Mike Rogers told CBS News's <em>60 Minutes</em>.
In response to Rogers' assertion William Plummer, spokesman for Huawei said "Huawei is a globally trusted and respected company doing business in almost 150 markets with over 500 operator customers, including nationwide carriers across every continent save Antarctica. The security and integrity of our products are world proven. Those are the facts today. Those will still be the facts next week, political agendas aside."
Executives for both Huawei and ZTE denied the allegations from the intelligence committee hearing, claiming to not be controlled by the Chinese government. Former US government foreign technology analyst Jim Lewis was asked if Huawei were ordered by the Chinese government to spy on the US, and he answered that said "the state tells them what to do and they do it."
US officials skeptical of ZTE's motives found those fears supported in part when the company admitted earlier this year that its Score smartphone model -- and perhaps other models -- <a href="http://macnn.com/rd/266465==http://www.electronista.com/articles/12/05/18/zte.score.vulnerable.to.hardwired.backdoor.exploit/" rel='nofollow'>contained a hardwired backdoor exploit</a> allowing anyone with knowledge of its hardwired password to take control of the handset. ZTE maintains that the feature was meant only to push software updates, though security experts contend there are much less suspicious ways to accomplish that.
ZTE claims that it is being as forthcoming and transparent with US government officials as possible and will cooperate with regulators. A statement from the company said that ZTE will look to demonstrate to the US Congress its "unique ability" to provide cyber security solutions both for congress and the executive branch.
Huawei is doing work on the telecommunications infrastructure in Kansas and a few other rural markets. The president of United Wireless, Craig Mock, tells Kroft he did business with Huawei because he didn't know of any other American company that made the equipment he needed. As a result of the deal, Mock was visited by federal agents who reviewed the terms of the deal, and examined some of the Huawei-provided equipment.