US urges US companies to avoid Chinese data services companies

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(Bloomberg) – The Department of Homeland Security has warned U.S. companies against using data services and equipment from companies linked to China due to cybersecurity and other risks.

“For too long, US networks and data have been exposed to China-based cyber threats that use this data to give Chinese companies an unfair competitive advantage in the global marketplace,” said Acting Homeland Security Secretary Chad Wolf in a letter with a long notice posted Tuesday night.

“Practices that give the PRC government unauthorized access to sensitive data – both personal and proprietary – expose the US economy and businesses directly to exploitation. We urge companies to exercise caution before entering into a deal with a PRC-related company, ”Wolf added.

The advisory was issued as the Trump administration, in its final weeks, imposed new sanctions on Chinese companies amid the continued deterioration of relations between the two countries. It also comes as US government agencies and businesses continue to try to assess the damage caused by a massive hacking operation that senior US officials have blamed on Russia.

President Donald Trump, however, downplayed the severity of the aggression and hinted that China could have been behind it.

The DHS advisory did not address the recent attack in its discussion of “the data risks American businesses face as a result of the actions of the People’s Republic of China.”

“The PRC’s data collection actions pose a number of risks to US businesses and customers, including: theft of trade secrets, intellectual property and other confidential business information,” wrote the reviewers. .

(Updates with link to notice, in second paragraph)

© 2020 Bloomberg L.P.

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