Department of Justice announces hacking charges against Chinese officials. Pictured, left to right: U.S. Attorney for Western District of Pennsylvania David Hickton, Attorney General Eric Holder, Assistant Attorney General for National Security John Carlin, FBI Executive Assistant Director Robert Anderson, and unidentified.
Department of Justice announces hacking charges against Chinese officials. Pictured, left to right: U.S. Attorney for Western District of Pennsylvania David Hickton, Attorney General Eric Holder, Assistant Attorney General for National Security John Carlin, and FBI Executive Assistant Director Robert Anderson. (Photo: Andrew Ramonas/NLJ.)

The federal government on Monday unsealed espionage indictments targeting five Chinese military officials it accused of hacking into computer systems run by Alcoa Inc., United States Steel Corp., Westinghouse Electric Co. and other U.S. corporations.

The accused hackers, members of the Chinese People’s Liberation Army, face 31 criminal counts relating to the use of cyberespionage to steal trade secrets and other U.S. business information in the nuclear power, solar energy and metals industries to benefit Chinese companies. The military officials, using aliases including “UglyGorilla,” “WinXYHappy” and “KandyGoo,” allegedly targeted the U.S. organizations from at least 2006 until this year. In addition to Alcoa, U.S. Steel and Westinghouse, the organizations include Allegheny Technologies Inc., SolarWorld A.G.’s U.S. subsidiaries and the United Steelworkers.

The indictments represent the first charges brought in the United States against foreign-government officials alleging infiltration of the cyber networks of U.S. companies. Although the ability of U.S. authorities to apprehend the hackers is unclear, Attorney General Eric Holder Jr. said the U.S. Department of Justice will seek to put them on trial in the Pittsburgh federal court, where a grand jury issued the indictment.

“This administration will not tolerate actions by any nation that seeks to illegally sabotage American companies and undermine the integrity of fair competition in the operation of the free market,” Holder said during a news conference at DOJ headquarters in Washington. “This case should serve as a wake-up call to the seriousness of the ongoing cyberthreat.”

David Hickton, the U.S. attorney in Pittsburgh, declined to put a dollar amount on the damage allegedly caused. But he said it was “very substantial” and forced U.S. companies to eliminate jobs.

Devon Cichoski, a SolarWorld spokeswoman, wrote in an email that her company welcomed the indictment. SolarWorld, which makes solar-power technology, had “thousands of emails and related attachments that provided detailed information about SolarWorld’s financial position, production capabilities, cost structure, and business strategy” stolen by Wen Xinyu, also known as “WinXYHappy,” and at least one other unidentified co-conspirator in 2012, according to the indictment. At the time, the company was litigating trade cases against Chinese solar manufacturers.

“We are deeply troubled by allegations that Chinese military officials illegally hacked into our computer systems,” she wrote. “It’s yet another example of the Chinese government’s systematic campaign to seek unfair advantage in the U.S and global solar industry.”

Wayne Ranick, a United Steelworkers spokesman, said his union also appreciated the government’s move. The indictment alleges that Wen pilfered emails that had “strategic discussions from senior union employees” after United Steelworkers international president Leo Gerard announced a “call to action” against Chinese policies in 2012.

“We find these charges quite troubling,” he said.

Robert Anderson, executive assistant director or the FBI, said “many” more U.S. organizations likely are victims of Chinese hackers. He said the U.S. government stands ready to help. The indictment signifies a “new normal” in action against hackers abroad, he said.

“This is what you’re going to see on a recurring basis—not just every six months, not just every year,” Anderson said. “It’s very clear if you’re going to attack Americans, whether for criminal or national security purposes, we are going to hold you accountable, no matter what country you live in.”

Contact Andrew Ramonas at aramonas@alm.com.