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China Hacking Claims Full of Loopholes, State Media Says

Feb. 21 (Bloomberg) -- China’s state-owned news agency said claims the nation’s military is behind global cyber attacks are “full of loopholes.”

It is “highly unlikely” anyone can trace where attacks originate from because hackers hide behind a network of proxies, Xinhua News Agency said in a commentary late yesterday. The article was in response to a report this week by Alexandria, Virginia-based security firm Mandiant Corp., which said the Chinese army was probably backing a hacking group operating from a Shanghai office block.

“It is beyond belief that a firm specialized in the field of cyber security could be so indiscreetly desperate as to jump to a conclusion so full of loopholes,” Xinhua said. The claims “will only tarnish the image and reputation of the company making them, as well as that of the U.S.”

China’s foreign ministry and the People’s Liberation Army have also both said this week that the country doesn’t support hacking. Mandiant said the Chinese army is probably the source of hacking attacks against at least 141 companies globally since 2006.

U.S. politicians and businessmen “seek to use China to pursue their personal political and commercial interests,” Xinhua said. The country needs China as a “presumed enemy” to justify spending on an even stronger cyber military force, it said.

U.S. President Barack Obama issued an executive order Feb. 12 to develop voluntary cyber security standards for companies operating power grids, telecommunication networks and banks. His administration yesterday pledged to share more intelligence with companies about nations involved in economic espionage and methods used to steal corporate information.

The U.S. military has “a significant cyber force” of its own, including the 780th Military Intelligence Brigade, which carries out cyber missions, Xinhua said.

The 780th Brigade’s official website says the unit “conducts signals intelligence, computer network operations, and enables dynamic computer network defense operations of Army and Defense networks.”

To contact Bloomberg News staff for this story: Edmond Lococo in Beijing at elococo@bloomberg.net

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net

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