According to a new court filing, China’s intelligence agencies allegedly attempted to bribe a US official with bitcoin. The document details how an individual operating as an FBI undercover agent informed the Chinese national that he knew the information being sought and could provide it for the right price. This individual then offered to sell the data for between $10,000 and $20,000 worth of bitcoin. According to the filing, the individual said he would use a “cleaned” bitcoin wallet with money that was first mixed using Wasabi Wallet. This open-source privacy-focused wallet service integrates bitcoin funds, making them harder to trace back to the source. The transaction was meant to be carried out at a later date and location in New York City.
The Case
A court appeal has been filed by the Department of Justice in the US. It is a document alleging that Chinese intelligence agencies attempted to bribe a US official by offering him bitcoin.
The document, filed on Monday, claims that Chen Min, an alleged Chinese national who worked for Huawei Technologies USA Inc., attempted “to persuade [the] defendant corruptly. The Chinese company did this with the intent to influence [the] official act[s] of such public official as those acts related to their duties as a Deputy Assistant Secretary for Global Strategic Initiatives at the Department of Commerce” in exchange for insider information about an unnamed company’s negotiations with China on telecommunications equipment sales.
Past Cases
The DOJ has been warning about the threat from foreign intelligence operations targeting US government officials since at least 2012 when it released a brochure titled “Foreign Spies Stealing US Economic Secrets in Cyberspace.” In addition to identifying China’s intelligence agencies (including the Ministry of State Security) as some of the most aggressive actors in this category, the report also states that such agencies are known to try and bribe foreign officials through financial incentives and other means:
“China’s intelligence services are known to target overseas officials who have access or influence over companies or industries operating within China’s borders. These services will often offer payments or other benefits in exchange for sensitive information on commercial technology, critical infrastructure systems, or trade negotiations.”
In 2018 alone, there were at least four cases where members of China’s People’s Liberation Army were accused of trying to steal data from U.S.-based companies by hacking into their computer networks (including one case involving an employee at PacNet Services).
FBI Involvement
According to the complaint, an individual operating as an FBI undercover agent informed the Chinese national that he knew the information being sought and could provide it for the right price. This individual then offered to sell the data for between $10,000 and $20,000 worth of bitcoin.
The complaint alleges that on May 7th of this year, an undercover FBI agent spoke with an American citizen known to be working within a company targeted by Chinese intelligence, which claimed that his company was paying him $1 million per year in salary. When asked why he would take such a large salary from a small firm instead of working as a consultant or contractor with other companies in areas where his expertise was more practical (such as cybersecurity), he replied, “because they know I’m there already.”
Wasabi Wallet
According to the filing, the individual said he would use a “cleaned” bitcoin wallet with money that was first mixed using Wasabi Wallet. This open-source privacy-focused wallet service integrates bitcoin funds, making them harder to trace back to the source. The transaction was meant to be carried out at a later date and location in New York City.
The court filing doesn’t explicitly mention which intelligence agency is suspected of conducting this operation or which data it sought to obtain. However, it reveals that the suspect worked for a division that uses encrypted communications to communicate with targets in other countries and send them tools like secret cameras and microchips for stealing information.
The Department of Justice says they are currently working with Chinese authorities investigating the matter since 2016. However, it’s unclear what progress has been made since then or if any arrests have been related to these events.
Conclusion
The filing doesn’t explicitly mention which intelligence agency is suspected of conducting this operation or which data it sought to obtain. However, it reveals that the suspect worked for a division that uses encrypted communications to communicate with targets in other countries and send them tools like secret cameras and microchips for stealing information.
