US Navy and NASA Caught Using Suspicious Chips From China Despite Blacklisting Them

The escalating tensions between China and the US have led to a growing sense of caution among Americans and the US government regarding Chinese-owned technologies, ranging from TikTok to Huawei routers and DJI drones.

However, the intricate nature of the hardware supply chain has resulted in encryption chips, supplied by a subsidiary of a company with direct connections to the Chinese military and highlighted in warnings issued by the US Department of Commerce, finding their way into the storage hardware of sensitive high profile military and intelligence networks throughout Western countries.

Hualan, along with its subsidiary Initio, which was initially based in Taiwan before being acquired in 2016, continues to provide encryption microcontroller chips to Western manufacturers of encrypted hard drives. Notably, some of these manufacturers count prominent aerospace, military, and intelligence agencies among their customers, including NASA, NATO, and the military forces of the US and UK, as evident from their websites.

The ownership of the chip vendor by a Chinese entity has instilled concerns among security researchers and analysts specializing in China’s national security. There are apprehensions that the chips may have a concealed backdoor, potentially enabling the Chinese government to decrypt confidential information held by Western agencies without detection.

While no such backdoor has been discovered to date, security researchers caution that if one were present, identifying it would be exceedingly challenging.

WIRED reached out to Hualan for comment on multiple occasions but did not receive a response. However, Mike Ching, a spokesperson for Initio, provided a statement clarifying that Initio primarily focuses on developing controller chips for consumer storage products.

He emphasized that their current products are internally developed by Initio and asserted that the company does not have the ability to introduce backdoors into their products.

In addition to contacting Hualan and Initio, WIRED also reached out to several customers of these companies, including NATO, NASA, the US Navy, the US Army, the DEA, and the FAA.

While those who responded declined to comment on the specific hardware they procure, statements from NATO, the US Navy, and the UK Ministry of Defence emphasized their rigorous evaluation of the security of the technology they utilize.