Huawei alumni’s firm needs scrutiny, lawmakers say

WASHINGTON: Baicells, a Chinese telecoms hardware maker founded by veterans of heavily sanctioned Huawei that has equipment operating in every American state, needs rigorous scrutiny by the US government, the top Republican on the House select committee on China said.

“The presence of this company – or any company with known cyber vulnerabilities in their products – anywhere in the US should raise significant national security alarms,” John Moolenaar said in a statement to Reuters.

“The Chinese Communist Party is relentlessly pursuing efforts to export its oppressive surveillance state, and companies like Baicells, despite their claims of security, must be scrutinised rigorously.”

Sun Lixin, Beijing-based chairman of Baicells Technologies Lt, said in a statement that even the largest software, hardware and mobile phone makers would never issue a statement claiming their products “have no security vulnerabilities.”

“That’s precisely why all commercial companies keep releasing version updates to ensure that they can keep up with the fixing of discovered vulnerabilities,” he added.

Baicells previously said in a statement to Reuters that it does not believe its base stations present security risks and that it is willing to cooperate with any US inquiry.

The Chinese embassy in Washington said in a statement that “Beijing hopes that the US will truly respect the principles of market economy and fair competition, stop unreasonably suppressing companies from other countries, and provide an open, fair, just and non-discriminatory environment for companies from all countries to invest and operate in the US.”

Baicells has provided base stations and routers to over 700 US networks across the country, including in sensitive locations close to military installations, Reuters reported on Thursday.

Its firmware has been flagged for cyber vulnerabilities by cyber watchdog CISA, and the company is currently under investigation by the FBI and the commerce department over national security concerns, Reuters also reported.

The scrutiny of Baicells comes amid growing concerns in Washington about China’s ability to intercept sensitive data, by hacking into telecoms networks, remotely accessing hardware supplied by Chinese companies, or providing Americans with internet access.

US networks have been targeted by a wide variety of state-backed hacking groups around the world, including a high-profile Chinese group dubbed “Volt Typhoon”, according to US officials.

“Companies with ties to foreign adversaries like China, who are intent on exploiting vulnerabilities in our telecommunications networks for espionage, are a dangerous and growing threat to our national security,” said Democratic congressman Frank Pallone, who serves as ranking member on the energy and commerce committee.

“I look forward to hearing from the national security agencies investigating Baicells, so we can continue to root out these hostile actors and protect the integrity of our critical infrastructure,” he added.

His remarks echoed comments made by Democratic senator Mark Warner, a ranking member of the Senate intelligence committee, who took aim at the US approach to addressing such threats.

While recent high profile Chinese attacks on US telecoms networks hinged on breaches of poorly secured Western equipment, “allowing (China)-linked suppliers into our supply chains and not exercising the necessary scrutiny is counterproductive,” he said. “The whack-a-mole approach, focusing on the national security risks posed by a single company at a time, is not nimble enough to respond to the threats that we are seeing.”