Huawei Focus of U.S. Intelligence Probe

According to House Permanent Select Committee on Intelligence Chairman Mike Rogers (R., Mich.), the legislative group is reviewing Huawei Technologies and the smaller ZTE Corporation to determine whether they provide "the Chinese government an opportunity for greater foreign espionage".

"The Chinese are aggressively hacking into our nation's networks, threatening our critical infrastructure and stealing secrets worth millions of dollars in intellectual property from American companies", Dutch Ruppersberger, a Maryland Democrat, said in the release. "This jeopardizes our national security and hurts U.S. competitiveness in the world market".

The investigation is part of increasing U.S. government scrutiny of economic espionage by China, which is the prime suspect in several hacks targeting military suppliers, information technology companies, and the pharmaceutical industry.

This spring, defense contractor Lockheed Martin's computer network suffered a "significant and tenacious" data attack, and details last month indicate the extent of that intrusion may be wider than originally thought.

In July, William J. Lynn, deputy defense secretary, announced the Pentagon's latest cyber-security initiative, acknowledging the U.S. government had a "pretty good idea" what country backed the recent attacks of Lockheed Martin and others.

Earlier this month, a bipartisan group of U.S. senators and the Obama administration discussed quick cyber-security legislation, as threats to industrial and government networks continue to grow.

Huawei, China's largest phone-network equipment maker, established a U.S. headquarters in Plano, Texas in 2001, but its efforts to expand in the U.S. have been thwarted by lawmakers who raised concerns about the company's alleged links to China's military, allegations the company has denied.

This past February, the Shenzhen-based company released an open letter detailing how the U.S. government used "falsehoods" and "unfounded" concerns to thwart its recent $2 million bid for bankrupt cloud-computing firm 3 Leaf. In the end, the U.S. government disallowed the purchase, determining the transfer of Intel's patents to the Chinese company could pose "a serious risk" to the U.S. computer networks.

In spite of these events, Huawei recently announced the company will focus on offering more affordable Android smartphones and sell LTE phones next year in order to secure a place as one of the top five players in the U.S. handset market.

News of the probe, which puts added pressure on Bejing to curtail electronic snooping, won't likely help Huawei, a $30 billion maker of telecoms gear and personal devices, as it works to further its goals in the U.S. market, but the company claims it is open to a review.

"The integrity of our solutions has been proven worldwide", said William Plummer, a Washington-based spokesman for Huawei. According to Plummer, the company welcomes "an open and fair investigation".