US probes China's Huawei over equipment near missile silos

US authorities are concerned Huawei could obtain sensitive military data via the equipment. PHOTO: REUTERS

WASHINGTON (REUTERS) - The Biden administration is investigating Chinese telecoms equipment maker Huawei over concerns that United States cell towers fitted with its gear could capture sensitive information from military bases and missile silos that the company could then transmit to China, two people familiar with the matter said.

The authorities are concerned Huawei could obtain sensitive data on military drills and the readiness status of bases and personnel via the equipment, one of the people said, requesting anonymity because the investigation is confidential and involves national security.

The previously unreported probe was opened by the Commerce Department shortly after President Joe Biden took office early last year, the sources said, following the implementation of rules to flesh out a May 2019 executive order that gave the agency the investigative authority.

The agency subpoenaed Huawei in April 2021 to learn the company's policy on sharing data with foreign parties that its equipment could capture from cell phones, including messages and geolocational data, according to the 10-page document seen by Reuters.

The Commerce Department said it could not "confirm or deny ongoing investigations". It added that "protecting US persons' safety and security against malign information collection is vital to protecting our economy and national security".

Huawei did not respond to a request for comment. The company has strongly denied US government allegations that it could spy on US customers and poses a national security threat.

The Chinese embassy in Washington did not respond to the specific allegations. In an e-mailed statement, it said: "The US government abuses the concept of national security and state power to go all out to suppress Huawei and other Chinese telecommunications companies without providing any solid proof that they constitute a security threat to the US and other countries."

Reuters could not determine what actions the agency might take against Huawei.

Eight current and former US government officials said the probe reflects lingering national security concerns about the company, which was already hit with a slew of US restrictions in recent years.

If the Commerce Department determines Huawei poses a national security threat, it could go beyond existing restrictions imposed by the Federal Communications Commission (FCC), the US telecoms regulator.

Using broad new powers created by the Trump administration, the agency could ban all US transactions with Huawei, demanding US telecoms carriers that still rely on its gear quickly remove it, or face fines or other penalties, a number of lawyers, academics and former officials interviewed by Reuters said.

The FCC declined to comment.

US-China tech war

Huawei has long been dogged by US government allegations that it could spy on US customers, though the authorities in Washington have made little evidence public.

"If Chinese companies like Huawei are given unfettered access to our telecommunications infrastructure, they could collect any of your information that traverses their devices or networks," FBI director Christopher Wray warned in a speech in 2020. "Worse still, they'd have no choice but to hand it over to the Chinese government, if asked."

Reuters could not determine if Huawei's equipment is capable of collecting that sort of sensitive information and providing it to China.

"If you can stick a receiver on a (cellphone) tower, you can collect signals and that means you can get intelligence. No intelligence agency would pass an opportunity like that," said Mr Jim Lewis, a technology and cyber-security expert at the Centre for Strategic and International Studies (CSIS), a Washington DC-based think-tank.

One move to address the perceived threat was a 2019 law and related rules forbidding US companies from using federal subsidies to buy telecoms equipment from Huawei.

It also tasked the FCC with compelling US carriers that receive federal subsidies to purge their networks of Huawei equipment, in return for reimbursement.

But the so-called "rip and replace" deadline to remove and destroy Huawei equipment completely will not kick in until mid-2023 at the earliest, with additional opportunities for companies to seek extensions.

And reimbursements will reach only 40 per cent of the total requested for now.

Towers near missile silos

Cell towers equipped with Huawei gear that are close to sensitive military and intelligence sites have become a particular concern for US authorities, according to the two sources and an FCC commissioner.

Mr Brendan Carr, one of the FCC's five commissioners, said that cellphone towers around Montana's Malmstrom Air Force Base - one of three that oversee missile fields in the United States - ran on Huawei technology.

In an interview this week, he told Reuters there was a risk that data from smartphones obtained by Huawei could reveal troop movements near the sites: "There's a very real concern that some of that technology could be used as an early warning system if there happened to be, God forbid, an ICBM missile strike."

Reuters was unable to determine the exact location or scope of Huawei equipment operating near military facilities.

Individuals interviewed by Reuters pointed to at least two other likely cases in Nebraska and Wyoming.

Ms Crystal Rhoades, a commissioner at Nebraska's telecoms regulator, has flagged to media the risk posed by the proximity of cell towers owned by Viaero to intercontinental ballistic missile (ICBM) silos in the western part of the state. ICBMs carry nuclear warheads to targets thousands of miles away and are stored in underground silos near military bases.

The Nebraska cell towers are near a missile field overseen by F.E. Warren Air Force Base in neighbouring Wyoming.

Viaero provides mobile telephone and wireless broadband services to about 110,000 customers in the region.

It said in a 2018 filing to the FCC opposing the commission's efforts at curbing Huawei's expansion that approximately 80 per cent of its equipment was manufactured by the Chinese firm.

That gear could potentially enable Huawei to glean sensitive information about the sites, Ms Rhoades told Reuters in June.

"An enemy state could potentially see when things are online, when things are offline, the level of security, how many people are on duty in any given building where there are really dangerous and sophisticated weapons," she said.

Ms Rhoades said in July that she had not been updated on rip-and-replace efforts by Viaero in more than two years, despite requesting updated information from the company in recent weeks.

At the time of last contact, the company said it would not begin removal efforts until the FCC money became available. The FCC advised companies on Monday how much of their funding requests it can reimburse.

Viaero did not respond to multiple requests for comment. Huawei also declined to comment.

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