US weighs China sanctions after cyber hack

This July 6, 2015 file photo shows Stock investors as they check computers under Chinese writing which translates as 'stock market has risk' at a brokerage house in Shanghai in a July 6 file photo. The United States is reportedly drawing up economic
This July 6, 2015 file photo shows Stock investors as they check computers under Chinese writing which translates as 'stock market has risk' at a brokerage house in Shanghai in a July 6 file photo. The United States is reportedly drawing up economic sanctions to target Chinese firms and individuals that profited from cyber attacks on American targets. PHOTO: AFP

WASHINGTON (AFP) - The United States is considering economic sanctions against Chinese firms and individuals that profited from cyber attacks on American targets, a senior administration official said Monday.

Following a spate of cyber attacks on US companies and government agencies that have been widely blamed on China, the official said that Washington would respond "in a manner and timeframe of our choosing".

In April, President Barack Obama signed an executive order, paving the way for tougher sanctions against "malicious cyber actors".

"The administration is pursuing a comprehensive strategy to confront such actors," the official said. "That strategy includes diplomatic engagement, trade policy tools, law enforcement mechanisms, and imposing sanctions on individuals or entities."

"We are assessing all of our options to respond to these threats in a manner and timeframe of our choosing," the official added.

The United States has struggled to build an effective deterrence against a wave of increasingly damaging cyber attacks.

The government's intrusion detection system "Einstein" recently failed to prevent a breach of sensitive data on millions of senior personnel.

But calibrating which attacks warrant diplomatic protests and which require a more forceful response has proven fraught.

A year ago, US prosecutors unsealed indictments levelling spying charges against five Chinese military personnel they believe hacked into US networks to profit Chinese firms.

But any broader move by the world's biggest economy to punish the second largest could have global political and economic consequences and would likely trigger retribution.

And it will be all the more controversial in the run-up to next month's much-anticipated state visit to Washington by Chinese President Xi Jinping.

The Washington Post on Monday quoted a US official as saying any further sanctions would send "a signal to Beijing that the administration is going to start fighting back on economic espionage."

"It tells China, enough is enough."

The world's economic giants have deep economic ties but a tense relationship.

The United States is an ally of Taiwan, which Beijing sees as part of its territory awaiting reunification, by force if necessary, and sides with Beijing's Asian neighbours in territorial disputes over sea lanes and island chains.

The sanctions, if they come about, would be designed to counter the unfair advantage Washington fears Beijing has developed by illegally gathering US economic intelligence.

But there is also deep concern here about a series of hacks apparently aimed at gathering political intelligence, some of them blamed on hackers with Chinese or Russian links.

Citing US intelligence officials, the Los Angeles Times reported Monday that Russian and Chinese foreign spy services are cross-indexing hacked databases to identify American agents.

Recent breaches of US federal government personnel files and email systems, when combined with private data such as medical record and airline bookings, could leave US spies exposed.