State Dept to limit use of Chinese computers

By Richard Cowan

WASHINGTON (Reuters) – The State Department, reacting to
security concerns after its purchase of computers from a
Chinese company, will not use the equipment for classified
information, the agency said on Thursday.

Government security experts are recommending that the
nearly 16,000 computers purchased last fall from China’s Lenovo
Group Ltd. “be utilized on unclassified systems only,” said
Assistant Secretary of State Richard Griffin in a letter to
Congress.

The letter did not specifically cite security concerns with
Lenovo. But it said that the department was altering its
procurement process “in light of the changing ownership of IT
(information technology) equipment providers.”

The State Department took the action on the $13 million
contract after questions were raised recently about the
computers by Rep. Frank Wolf, a Virginia Republican who
oversees the agency’s funds.

“I was deeply troubled to learn that the new computers were
purchased from a China-based company, and that at least 900 of
these computers were planned to be used as part of the
classified network deployed in the United States and around the
world in embassies and consulates,” Wolf said.

But Lenovo said the U.S. government’s concerns were
unwarranted.

“We know these computers present no security risk because
they do not have back doors and they do not have surveillance
software tools installed on them,” said Jeff Carlisle, Lenovo’s
vice president of government relations.

Wolf is a frequent critic of China’s human rights policies
and he said Chinese firms with links to the Communist
government in Beijing should not win U.S. government contracts.

Since the September 11 attacks, there has been growing
skepticism in Congress of some foreign companies’ involvement
in American commerce.

OBJECTIONS TO PURCHASE

The computer deal also raised questions from the
congressionally created U.S.-China Economic and Security Review
Commission.

Michael Wessel, a Democratic commissioner on the panel that
monitors China trade and national security implications, said:
“The U.S. is a principal intelligence target for China.”

He added that a “significant portion” of Lenovo is owned by
the Chinese Academy of Sciences, an arm of the Chinese
government.

In March, Wessel said the U.S. government should be worried
about the computer purchase, especially if there were codes
embedded into the computers that could be remotely activated.

Carlisle countered that Lenovo “has always operated as a
market-oriented independent company” and that the Chinese
Academy of Sciences has only a “minority interest.” He said the
academy does not direct Lenovo’s day-to-day operations and does
not have a member on its board of directors.

The State Department said the Lenovo computers were
purchased under standard U.S. government purchasing rules. The
computers were procured through CDW Corp., a government
contractor based in Vernon Hills, Illinois.

Lenovo bought IBM’s personal computer division last May.
The computers bought by the State Department were assembled in
the United States and Mexico with integrated circuits made in
Taiwan, according to the company.

Details of the State Department contract surfaced shortly
after Congress pressured a state-owned Arab company, Dubai
Ports World, into walking away from plans to manage several
U.S. port terminals.

Last year, China’s state-controlled CNOOC Ltd. dropped its
bid to acquire U.S. oil and gas company Unocal Corp. after a
strong backlash from the U.S. Congress.