Hacking, A Growing Menace In China (SYMC, IBM, GOOG, YHOO)

According to a report by the Financial Times, with 400 million people, China has the biggest population of internet users. Probably the country also has the world’s biggest population of hackers. According to a report by Message labs, a research arm of Symantec (NASDAQ: SYMC), last month, China became the biggest source of targeted hacking attacks.

Eagle Wan, a veteran Chinese hacker now working for IBM (NYSE: IBM), says, ‘’there are no more than 1000 people in China who are capable of producing genuinely new tools; but those with basic training who can tweak and use tools are in their hundreds of thousands.’’ Google (NASDAQ: GOOG) too cited the reason of large scale hacking in mainland China as one reason why it decided to shift its Chinese search engine from mainland to Hong Kong.

Last week, there were dozens of cases where the hackers broke into the Yahoo (NASDAQ: YHOO) email accounts of China experts. Similarly, large scale hacking also compelled The Foreign correspondents club of China to shut down its website after experiencing a series of "denial of service" attacks. Chinese hacking has forced both the U.S and Europe to focus on intelligence gathering. But the hacking problem has become more prevalent inside China, according to Chinese officials and internet experts. They see that attacks on foreign nationals are only a fraction of total intrusions. The China internet network information center, the state-owned domain name registrar, revealed that last year more than half of the China’s internet users encountered cyber attacks. In most of the cases "netizens" encountered problems involving viruses and Trojan Horses, malicious software that facilitates unauthorized access to a recipient’s computer.

Wan, a hacker and close to the hacker community, says that back in the "1990s when the internet in China was just starting up, we were patriotic hackers, but now most people are in it for money". He further adds that some hackers are designing, tweaking and selling Trojans since it is the only way they know. Such practices have resulted in the creation of a new industry of criminal hackers in China. Liu Deliang, director of the Asia Pacific institute of cyber studies in Beijing, believes that one of the reasons behind large scale cyber crime is that China’s legal system is unfit to battle cybercrime. The fact that China‘s police are also organized along regional lines makes policing cybercrime difficult. Besides, China does not have cyber-savvy cops who could chase the growing number of cybercriminals and hackers, adds Liu.