Rep. Frank Wolf (R-VA), chairman of the House Appropriations Committee that funds the Justice and Commerce departments, released the following statement regarding the FBI investigation of Chinese telecom company ZTE:
"The reports of ZTE's alleged criminal activities to supply the Iranian government with illegal equipment in violation of U.S. laws and international trade embargoes -- as well as its alleged efforts to destroy evidence of these activities -- confirms what I have been warning my colleagues about: Chinese telecom firms like ZTE and Huawei are a serious threat to U.S. security. Just this week, I wrote every member of the House urging them to be aware of ZTE's activities and to be cautious in meeting with the company and its lobbyists.
"I commend the FBI and the Commerce Department for pursuing this case, and urge them to enforce the law to its fullest in this case. ZTE's alleged criminal activities are just part of the reason I carried bill language in the FY 2013 appropriations bill banning the government from purchasing telecom equipment from state-owned and state-directed Chinese companies."
Below is the text of the "Dear Colleague" Wolf sent to his colleagues on July 10:
HUAWEI, ZTE POSE THREAT TO U.S. SECURITY
Be Aware before Meeting with Lobbyists for Huawei and ZTE
This summer, you or your staff may be contacted by lobbyists representing Chinese telecom companies Huawei and ZTE, including some of our former colleagues. These Chinese state-directed companies have gone on a lobbying blitz lately, as the U.S. national security community and Congress have launched investigations into their potential threat.
Before you or your staff agrees to any meeting with lobbyists for these companies -- or consider purchasing Huawei or ZTE products for personal or office use -- I urge you to consider the following information:
* In May, computer security analysts publicly identified a "backdoor" in a ZTE mobile phone, which could be used by the Chinese government or others to secretly monitor information.
* The U.S. government has repeatedly intervened to prevent Huawei from acquiring U.S. companies or installing its equipment on telecom infrastructure in a significant capacity.
* Earlier this year, former Commerce Secretary John Bryson said, "It appears that Huawei has capabilities that we may not fully detect to divert information It's a challenge to our country."
* According to a recent piece from CBC News, former national counterintelligence executive Michelle Van Cleave described Huawei as a potential "stalking horse" for the Chinese government, noting, "China is a totalitarian government, and Huawei operates at the sufferance of the government "
* A number of Huawei's executives and board members, including its CEO and chair of the board, are former members of the Peoples Liberation Army and intelligence service.
* Our colleagues Mike Rogers and Dutch Ruppersberger have launched an investigation in to the threat from Huawei and ZTE to the U.S. government and private sector. As Chairman Rogers said, "I stand by my caution to the American business community about engaging Huawei technology until we can fully determine their motives."
* Last month, the House Intelligence Committee intensified its investigation into both firms in a series of letters highlighting unaddressed questions about security threats, subsidies and even the existence of a Chinese Communist "Party Committee" inside of Huawei. Their investigation is also looking into Chinese laws that require companies to provide information or take actions on behalf of the government.
* Chairman Rogers also noted that Huawei and ZTE equipment is believed to be subsidized by the Chinese government "so it can be multiple times cheaper than any local competitor," according to a June 21 Reuters article.
* Huawei and ZTE are leading suppliers of critical telecom services to some of the worst regimes around the world. Last year, the Wall Street Journal reported that Huawei "now dominates Iran's government-controlled mobile-phone industry it plays a role in enabling Iran's state security network."
For more information on Huawei, ZTE and the potential threat to U.S. security from these companies, I urge you to visit my Web page at http://wolf.house.gov/cybersecurity. I also urge you to request a classified briefing from the Office of the Director of National Intelligence on this threat.
Frank R. Wolf
Member of Congress