# NARRATIVE: China is stealing American AI — while Washington looks the other way

> A report says China is stealing more than half of America's military-civil technologies. The FBI confirms hundreds of billions in annual losses. And the Commerce Department spares 100 Chinese companie

- Author: Maxime Marquette
- Publisher: MadMax (https://mad-max.co)
- Section: Reportage
- Published: 2026-07-02
- Canonical URL: https://mad-max.co/en/article/recit-la-chine-vole-l-ia-americaine-pendant-que-washington-regarde-ailleurs

## Introduction: A report that should surprise no one

### CrowdStrike and the number that stings

In **June 2026**, the American cybersecurity firm **CrowdStrike** published a finding that should have dominated headlines but was eclipsed by war and diplomacy: Chinese entities accounted for **more than half** of all state-sponsored intrusions targeting technology companies — particularly their artificial intelligence assets — in the **12 months ending March 31, 2026**. More than half. This is not a worrying trend to monitor. It is an active, massive, documented campaign of industrial technological theft.

Along the same lines, the **FBI** issued an unequivocal statement: **"China's economic espionage campaign costs the American economy hundreds of billions of dollars per year and endangers our national security."** These figures, these statements, and this data are known. What is less known is that while American intelligence agencies were documenting this threat, the **U.S. Commerce Department** was quietly backing away from blacklisting more than **100 Chinese companies** that had already been approved by the interagency committee as security risks.

## DeepSeek and the companies that were spared

### The blacklist that is no longer black

The **Foundation for Defense of Democracies (FDD)** report from **June 27, 2026** tells the following story: the American interagency committee had approved adding more than **100 Chinese companies** to the **Commerce Department**'s **Entity List** — a list that restricts American exports to entities posing security risks. These approvals had been granted on the basis of coordinated risk assessments by multiple intelligence agencies.

But the **Commerce Department** refused to proceed with the blacklistings in order not to provoke a new escalation with **Beijing**. Among the companies spared was **DeepSeek**, the Chinese AI startup whose **R1** model had raised specific security concerns. This diplomatic choice — forgoing security measures to avoid commercial friction — illustrates exactly the contradiction at the heart of American policy toward **China** in **2026**.

### Why DeepSeek deserves attention

**DeepSeek** is not a simple technology company. Its **R1** model, presented as an open-source competitor to **OpenAI**'s models, sent shockwaves through the American tech sector in early **2026**. Its ability to rival leading American models at a fraction of the declared cost raises serious questions about its development methods — notably the possibility that this development benefited from data or technologies obtained through illegal channels.

The fact that the interagency committee recommended placing **DeepSeek** on the **Entity List**, and that this recommendation was overridden for diplomatic reasons, is revealing. It says that short-term economic interests with **China** outweighed documented national security concerns. This is not a trivial decision in a world where the technological competition is also a military security issue.

## China's economic espionage strategy

### Systematic targeting of AI assets

**CrowdStrike**'s data reveals specific and strategic targeting: technology companies whose artificial intelligence assets are the primary objective. This is not opportunistic espionage — it is a coordinated national policy aimed at closing the technological gap between **China** and the **United States** in the field of **AI**. **Beijing** has understood that the next wave of military and economic power will be shaped by **AI** — and that it is faster and less costly to steal than to develop.

This targeting takes several documented forms. Direct intrusions into companies' computer systems. **"Insider"** risks — employees or contractors who deliberately transmit information to Chinese actors. Recruitment via professional platforms such as **LinkedIn** and **Indeed**, documented in a **Five Eyes** report cited by **Japan Forward**. And investments in American **AI** startups that provide access to technologies through legal mechanisms.

### Documented access vectors

The **Five Eyes** report — the intelligence alliance comprising the **United States**, **United Kingdom**, **Canada**, **Australia**, and **New Zealand** — documented how **China** uses **LinkedIn** and **Indeed** to recruit Western technology professionals, either as spies or as unwitting vectors of technology transfer. These platforms, legitimately used by billions of people, become tools for approaching potential targets.

The company **Qihoo 360**, described by **Forbes** as the **"cyber giant behind China's Mythos rival,"** illustrates another dimension of this strategy: Chinese technology companies that develop offensive capabilities within a semi-public ecosystem that blurs the lines between private sector and state operations. This model — surveillance capitalism in the service of state espionage — is one of the asymmetric advantages **China** exploits in its competition with the **West**.

## The connection to Ukraine: China fuels Russia

### Technological theft in the service of war

There is a direct link between Chinese economic espionage in the field of **AI** and the war in **Ukraine** — and it deserves to be named explicitly. **China** is stealing artificial intelligence technologies that have direct military applications: autonomous guidance systems, image recognition for drones, optimization of military supply chains. Once mastered, these technologies can be shared or sold to **Russia**, which uses them in its drones and missile guidance systems.

This indirect technology transfer — from American industry, via Chinese espionage, to the Russian military — is difficult to document precisely. But its existence is plausible enough that American intelligence agencies have identified it as a strategic risk. The decision to spare **DeepSeek** and **100 other Chinese companies** from the **Entity List** must be read in this context: it potentially facilitates a technological flow that indirectly feeds the war against **Ukraine**.

### Beijing as enabler of the Russian war machine

**Beijing** has always denied supplying weapons directly to **Russia**. But the definition of **"military assistance"** is far broader than arms deliveries. Maintaining commercial flows with **Russia** under sanctions, providing dual-use (civilian and military) components, and the potential technological transfer in the fields of **AI** and drones constitute substantial support to the Russian war machine — even if no Chinese tank has been delivered to the Ukrainian front.

This reality is explicitly acknowledged by Western governments in their statements, even as they often hesitate to draw the consequences in terms of policy toward **Beijing**. The decision to spare Chinese companies from the **Entity List** in the name of diplomatic appeasement compounds this contradiction: we know what **China** is doing, we name the problem, and we choose not to act on it sufficiently.

## The American response: between sanctions and concessions

### The architecture of export controls

The **United States** has a legal arsenal to counter Chinese economic and technological espionage. The **Commerce Department**'s **Entity List** is one of its primary instruments. Export controls on advanced semiconductors, including restrictions imposed on **NVIDIA** and its partners, aim to deny **China** the chips needed to train cutting-edge **AI** models. However, the **Trump** government's decision to withhold its most advanced **AI** models — **Mythos** and **Fable** developed by **Anthropic** — from allies creates new friction: it slows technology sharing with reliable partners while doing nothing to prevent theft by adversaries.

The coherence of this policy is questionable. Advanced technologies are restricted from allies for reasons of control. Chinese companies identified as security risks are spared for diplomatic reasons. Cybersecurity programs are funded while recruitment platforms used by Chinese intelligence services operate freely. These contradictions are not the doing of any specific administration — they reflect the structural difficulty of simultaneously managing economic, diplomatic, and security interests that often conflict.

### What allies expect from Washington

For American allies in **Europe** and **Asia**, the central question is not whether **China** is spying. That is a documented certainty. The question is whether **Washington** will coordinate a collective, coherent response — shared with its allies — or continue managing this issue unilaterally and inconsistently. The **Five Eyes** have produced a joint report on **China**'s recruitment via **LinkedIn** — that is an example of working coordination. It needs to be expanded.

The **NATO summit in Ankara** is primarily focused on **Russia** and **Ukraine**. But **China** is there too — in the background, in discussions about technological dependency, defense supply chains, and cybersecurity capabilities. The twenty European conservative parliamentarians who made the trip to **Washington** raised these topics with the American administration. That is no coincidence.

## International cooperation: the Five Eyes and the need for a coordinated response

### A joint report, a shared threat

The **Five Eyes** report published in **2026** on spy recruitment via **LinkedIn** and **Indeed** marks an important milestone in Western intelligence coordination. For the first time, the five agencies — American (**NSA/FBI**), British (**GCHQ**), Canadian (**CSE**), Australian (**ASD**), and New Zealand (**GCSB**) — produced a joint warning explicitly addressed to private companies about the recruitment methods used by Chinese intelligence services. This report documents how professionally legitimate-looking profiles are used to approach researchers, engineers, and employees at sensitive technology companies.

The value of this kind of coordination extends beyond simple data aggregation. It sends a signal to Chinese espionage services that their methods have been identified. It raises awareness among potential targets in private companies. And it sets a precedent for coordinated sector-specific warnings — a model that could be expanded to **NATO** partners and **G7** countries.

### The limits of the multilateral response

Intelligence coordination has structural limits, however. Information sharing between allies is governed by strict rules on protecting sources and methods. The decision to publish a report on Chinese espionage methods means revealing part of what is known — and thus potentially compromising certain sources. This difficult calculation explains why public reports often lag behind what agencies know in real time.

There is also a political dimension. **China** responds strongly to any public accusation of espionage, dismissing it as **"defamation"** and **"Cold War politics."** For countries like **Canada**, **Australia**, or European nations that maintain significant economic ties with **Beijing**, the decision to co-sign an accusatory report carries a measurable diplomatic cost. Participation in these reports is therefore a political act, not merely an intelligence act.

## The AI dimension: why this technological war is existential

### AI as a military force multiplier

Artificial intelligence is not an abstract technological subject. It has concrete military implications that are transforming current and future wars. Drones equipped with autonomous target identification capabilities. Image recognition systems for missile guidance. Logistics optimization algorithms that allow armies to move more efficiently. **China** is investing massively in all of these applications — and according to **CrowdStrike**'s data, it is accelerating this development by stealing research from American technology companies.

**CrowdStrike**'s finding that Chinese entities are responsible for **more than half** of intrusions targeting technology companies' **AI** assets is not an approximate estimate — it is the result of continuous monitoring of the advanced persistent threats (**APT**) that characterize state espionage operations. These operations are sophisticated, patient, and long-term. They do not seek to cause immediate damage — they seek to transfer knowledge silently.

### The risk for future competition

The long-term stakes are those of global technological competition. If **China** succeeds in closing the gap in **AI** technologies through a combination of internal development and technological theft, it will have military capabilities in **10 to 15 years** comparable or superior to those of the **United States**. The implications for the security of **Taiwan**, for freedom of navigation in the **South China Sea**, and for American alliances in the **Asia-Pacific** are considerable.

This prospect is not an alarmist hypothesis. It is documented in American intelligence assessments, in **National Security Commission on AI** reports, and in analyses by independent experts. What is alarming is not the threat itself — it is known. It is the insufficient political response, illustrated by the decision to spare **100 Chinese companies** from the **Entity List** for diplomatic reasons.

## The human cost of technological espionage: what the numbers erase

### Companies, researchers, careers

Behind **CrowdStrike**'s numbers — **50%** of state-sponsored intrusions — there are people. Engineers whose years of work are copied in a matter of hours. Startups whose algorithms developed over months end up integrated into competing products, with no legal recourse. Researchers approached via **LinkedIn** with enticing job offers, some of whom do not immediately realize they are participating in an organized technology transfer.

The **FBI** estimates losses at **"hundreds of billions of dollars per year."** This figure is real, but it tends to dematerialize the human consequence. For an **AI** startup that discovers its technology has been stolen, there is often no recourse. Proving the origin of an intrusion, linking stolen code to a competing product, convincing a court of the harm's existence — it is a legal battle that few companies have the resources to fight.

### The culture of secrecy and its paradoxes

The institutional response to Chinese economic espionage suffers from a paradox. To be effective, cyber defense requires sharing information about attack vectors, intrusion methods, and the actors involved. But this information sharing requires admitting that one has been compromised — something most companies are reluctant to acknowledge publicly, for fear of the consequences on their reputation, partnerships, and market valuation.

This structural silence benefits espionage actors. Every compromised company that does not share its experience allows the same method to be used against others. **CrowdStrike**, **Mandiant**, and other cybersecurity firms play a crucial role in aggregating this data anonymously — but anonymous aggregation has its limits. The lack of transparency in the technology ecosystem is a systemic flaw that espionage services exploit with consistency.

## Conclusion: When commercial diplomacy sabotages national security

### The central contradiction

The narrative this article documents is that of a major contradiction in American policy toward **China** in **2026**: intelligence agencies identify companies that pose security risks, propose concrete measures, and those measures are blocked by diplomatic and commercial considerations. This pattern is not new — it has characterized the American-Chinese relationship for decades. But in the context of the competition over **AI** and a war in **Ukraine** where stolen technologies could end up in Russian missiles, this pattern has consequences that extend beyond bilateral Sino-American relations.

I am not an expert in the intricacies of American trade policy. I cannot demonstrate that the **100 Chinese companies** spared actually transferred technologies to **Russia**. But I can note that the available data — CrowdStrike, FBI, Five Eyes, FDD — converge on the same diagnosis: **China** is conducting a systematic campaign of technological theft in the field of **AI**, and this campaign is being insufficiently countered. That finding deserves to be stated clearly.

### What the West must decide

The **West** must decide whether it treats **China** as a trading partner with practices to correct, or as a rival power using commerce as a lever of influence. These two visions are not easily reconciled. The first implies continuous diplomatic concessions. The second implies real economic costs — supply chain disruption, higher prices for certain goods, diplomatic tensions.

These costs are real. They are also comparable to the costs of doing nothing: a **China** equipped with superior military **AI** capabilities in **15 years**, American technologies stolen for use in enemy weapons systems, and an economy whose most dynamic sectors are systematically pillaged. That calculation is not hard to make. It is hard to accept politically. That is where the real problem lies.

**By Maxime Marquette, columnist**

## Columnist's transparency note

### Editorial stance

I am not a journalist but a **columnist and analyst**. My expertise lies in observing and analysing the geopolitical, economic and strategic dynamics that shape our world. My work is to take political strategies apart, to understand global economic movements, to put the decisions of international actors in context and to offer analytical perspectives on the changes that are redefining our societies.

I do not claim the cold objectivity of traditional journalism, which stops at reporting facts. **I claim analytical clarity**, rigorous interpretation and a deep understanding of the complex issues that concern us all. My role is to give meaning to the facts, to place them in their historical and strategic context, and to offer a critical reading of events.

### Method and sources

This text keeps the basic distinction between **verified facts and interpretive analysis**. The rule never changes: a factual claim is published only when a verifiable source supports it, and the sources this article actually used are listed under **Sources**, never here.

**Primary source families** used by the publication, when the story has them: official statements from governments and international institutions, public statements by political leaders, reports from intergovernmental organisations, dispatches from recognised international news agencies.

**Secondary source families**: specialised publications, internationally recognised news media, analyses from established research institutions, reports from industry organisations.

When an article cites statistical, economic or geopolitical data, it comes from the institutions that produce it (intergovernmental organisations, central banks, national statistics offices), and the exact institution is named under **Sources**.

### Nature of the analysis

The analyses, interpretations and perspectives in the analytical sections of this article are a **critical, contextual synthesis** based on the information available, the trends observed and the expert comments cited in the sources consulted.

My role is to interpret these facts, to set them in the context of today's geopolitical and economic dynamics, and to give them a coherent meaning within the larger story of the changes shaping our time. These analyses reflect expertise built through continuous observation of international affairs and an understanding of the strategic mechanisms that drive global actors.

This article describes a documented state of affairs on its publication date, not a prediction: later developments may shift its outlook. No update is promised in advance; when an article is corrected or completed, the change is dated in the text.

## Sources

### Primary sources

- [CNBC — China-linked actors target far more than technology in an intense AI race with the U.S. — July 1, 2026](https://www.cnbc.com/2026/07/01/china-ai-cyberattacks-startups-insider-risks-espionage.html)

- [FDD Action — National Security Roundup: China and company blacklist — June 27, 2026](https://www.fddaction.org/natsec-roundup/2026/06/27/iran-pockets-relief-rejects-inspections-china-blacklists-firms-turkey-enables-terror/)

- [IANS Live — US warns China is stealing AI secrets — June 27, 2026](https://ianslive.in/us-warns-china-stealing-ai-secrets--20260627050303)

### Secondary sources

- [AI Weekly — Chinese espionage and AI assets — July 2026](https://aiweekly.co/node/3868)

- [Japan Forward — Five Eyes report: China recruiting spies via LinkedIn and Indeed — July 2026](https://japan-forward.com/china-linkedin-indeed-spies-recruitment-five-eyes-report/)

- [Forbes — Qihoo 360, the cyber giant behind China's Mythos rival — June 30, 2026](https://www.forbes.com/sites/the-wiretap/2026/06/30/qihoo-360-the-cyber-giant-behind-chinas-mythos-rival/)

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Source: Maxime Marquette, MadMax. When citing, name the author and link https://mad-max.co/en/article/recit-la-chine-vole-l-ia-americaine-pendant-que-washington-regarde-ailleurs