Foreign spying on U.S. defense technology seen rising

Pentagon report cites 43% jump in suspicious foreign contacts

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January 04, 2007 (Reuters) -- WASHINGTON -- Foreign countries, especially nations in the Asia-Pacific region, have intensified their efforts to steal sensitive U.S. defense technology, according to a Pentagon report circulated yesterday.

The Defense Security Service Counterintelligence Office recorded an annual jump of nearly 43% in the number of suspicious foreign contacts reported to U.S. authorities by defense contractors and other defense-related sources.

The agency, which helps protect the U.S. defense industry from foreign espionage, said in an unclassified report that spies used phony business offers and computer hackers to target advanced U.S. technology including lasers, sensors, missiles and other systems. The report covered the fiscal year ending September 2005 and is the most recent for which complete statistics are available.

In one case, a female spy seduced an American translator to learn his computer password. His unclassified network was later found to be infected by viruses planted by a foreign intelligence service.

The Defense Security Service did not return phone calls seeking comment.

The total number of suspicious foreign contacts climbed to 971 during fiscal year 2005, the report said. The number of countries trying to obtain U.S. technology also rose, to 106 from 90 a year earlier.

"The majority of reported targeting originated from East Asia and the Pacific, which accounted for 31% of all reporting," the Pentagon agency said in the report.

The Near East made up 23.1% of the targeting, followed by Eurasia at 19.3% and South Asia at 13.2%. Africa and the Western Hemisphere, not including the U.S., accounted for 11.5%.

The report, titled "Technology Collection Trends in the U.S. Defense Industry," did not accuse specific countries of espionage. But U.S. officials have long identified China, Russia and Iran as the leading counterintelligence threats to the U.S.

The Defense Security Service posted its 29-page report on a password-protected government Web site.

The Washington Times newspaper first reported on the report's existence on Wednesday. The Federation of American Scientists, a nonprofit group that advocates for government openness, later posted the document on its own Web site.