China hacked off at spying claims

China’s hackles were raised this week as it tried to censor news of the alleged hacking of a Shanghai police database, containing the personal data of more than 1bn of its citizens. Today it was angry about having to defend itself against a joint accusation by the US and UK that it too was guilty of hacking, and spying on businesses around the world.

In remarks to a gathering of business leaders and academics in London, FBI director Christopher Wray and the head of MI5, Ken McCallum, had warned that China’s industrial espionage posed a growing threat to western groups, including through “elaborate shell games” such as special purpose acquisition companies.

Zhao Lijian, China’s foreign ministry spokesperson, responded: “The facts fully prove that the United States is the greatest threat to world peace and development,” while the British intelligence service, was “projecting their own dishonourable behaviour on to China”.

McCallum said MI5 had seen a sevenfold increase in China-related investigations since 2018, had doubled its capacity to deal with them over the past three years and would probably double capacity again over the next “handful of years”.

Wray said FBI field offices across the US opened one investigation into Chinese espionage on average every 12 hours. Beijing was using “every tool” at its disposal to steal western technology in an effort to eventually undercut non-Chinese businesses and dominate their markets — even stealing genetically modified seeds from US farmland.

Both intelligence chiefs stressed that China often employed people who were not directly connected to its intelligence services to target western companies — a group Wray called “co-optees”.

Similarly, the FT has reported over the past week on Chinese university students being unwittingly lured to work at a secretive tech company that masked the true nature of their jobs: researching western targets for spying and translating hacked documents as part of Beijing’s industrial-scale intelligence regime. An FBI indictment of the perpetrators made no difference to the hiring spree, reinforcing the need for companies themselves to remain vigilant in the face of a concerted campaign by China.

Beijing also appears to have its own fears about being spied upon by US technology. John Thornhill’s latest column relates how Tesla cars have been banned from sensitive areas due to fears that their sensors and cameras can be used for espionage.

The Internet of (Five) Things

1. China’s Vivo targeted by Indian authorities
China is also getting hot under the collar about “frequent investigations” into Chinese companies operating in India. Financial authorities raided Chinese mobile phone maker Vivo over money-laundering allegations on Thursday. Earlier, they had accused Xiaomi of unlawfully remitting more than $700mn abroad.

2. Misra’s next move
Rajeev Misra, the trader who helped transform SoftBank into the world’s biggest and most controversial tech investor, is stepping back from the Japanese group to launch a new $6bn fund backed by Abu Dhabi. Misra, who structured and ran the record-breaking $100bn Vision Fund, said he would remain involved with SoftBank but that his new venture would pursue investment strategies beyond start-ups.

3. Amazon steps up live shopping efforts
Amazon has stepped up plans to crack the QVC-style livestream shopping market. It has been increasing investment in Amazon Live, reports Dave Lee, a platform it quietly launched in 2019 but is now a central focus as it fights to grab a slice of a growing market that is viewed as the future of shopping by social media platforms.

4. Samsung profits disappoint
Samsung Electronics has reported a smaller-than-expected operating profit for the second quarter as higher inflation damps consumer demand for mobile phones and other electronic gadgets. The company is bracing for waning demand in response to rapid price rises worldwide following the pandemic-driven surge in the tech sector over the past two years.

5. UK should outlaw ‘deepfake porn’, says review
The sharing of so-called “deepfake porn” should be made illegal in the UK, according to a government-backed review by the Law Commission. It warned current laws do not go far enough to cover “disturbing and abusive new behaviours born in the smartphone era”. Deepfake porn involves the creation of realistic but fake sexualised images or video content of an individual without their consent.

Tech tools — Mojo Lens

Mojo Lens chief executive Drew Perkins (pictured left) popped in a special contact lens recently to bring the vision of a smart wearable for the eye closer to reality. This was the “first ever on-eye demonstration of a feature-complete augmented reality smart contact lens”, he said in a blog post.

“Much to my delight, I found I could interact with a compass to find my bearings, view images, and use an on-screen teleprompter to read a surprising but familiar quote. I experienced first-hand the future with Invisible Computing.”

The Mojo lens still has a way to go though to become a commercial product. Perkins described it as at a testing platform stage that would need clinical studies and “ultimately lead to submission to the FDA for market approval”.