DOJ brings first-ever cyber-espionage case against Chinese officials

May 19, 2014: Attorney General Eric Holder speaks at a news conference at the Justice Department in Washington. (AP)

Attorney General Eric Holder on Monday announced a first-of-its-kind criminal cyber-espionage case against Chinese military officials the Justice Department charges hacked into major U.S. companies to steal trade secrets -- though Holder could not say whether the five defendants stand a chance of ever seeing the inside of a U.S. courtroom.

Holder, in announcing the indictment against five Shanghai-based officials, acknowledged that the defendants have never set foot in the United States.

Pressed on whether there's any hope the Chinese government would hand over the officials, Holder said only the "intention" is for the defendants to face the charges in a U.S. court, and he hopes to have Chinese government cooperation.

But the Chinese government immediately signaled it would not cooperate, claiming the accusations were made up and warning the case would damage U.S.-China relations.

According to Reuters, Foreign Ministry spokesman Qin Gang urged "immediate rectification."

The highly touted indictment appears to serve more to shed light on the growing problem of cyber-espionage than to guarantee any of the defendants will have their day in a Pittsburgh, Pa., federal court, where the case is being brought.

U.S. prosecutors described the alleged crimes as "21st century burglary."

The indictment accused the Chinese officials of targeting the U.S. nuclear power, metals and solar products industries. The alleged victims include major U.S. firms like Alcoa World Alumina, Westinghouse Electric and U.S. Steel Corp.

Holder said the hackers were targeting a total of six American companies, stealing information deemed useful to companies in China, including state-owned firms. He stressed that the alleged hacking is far different than the type of intelligence gathering conducted by governments around the world, in that this involved cyber-espionage for the sheer purpose of gaining the commercial upper hand against U.S. businesses.

"This is a tactic that the United States government categorically denounces," Holder said. "This case should serve as a wake-up call to the seriousness of the ongoing cyberthreat."

The charges were described as the first such case brought against state actors. The specific charges relate to cyber-espionage and theft of trade secrets.

John Carlin, recently installed as head of the Justice's National Security Division, had identified the prosecution of state-sponsored cyberthreats as a goal for the Obama administration.

"For the first time, we are exposing the faces and names behind the keyboards in Shanghai used to steal from American businesses," he said Monday, accusing the Chinese officials of "stealing the fruits of our labor."

The other victims listed include Allegheny Technologies, United Steelworkers Union, and SolarWorld.

U.S. officials have accused China's army and China-based hackers of launching attacks on American industrial and military targets, often to steal secrets or intellectual property. China has said that it faces a major threat from hackers, and the country's military is believed to be among the biggest targets of the NSA and U.S. Cyber Command.

Last September, President Obama discussed cybersecurity issues on the sidelines of a summit in St. Petersburg, Russia, with Chinese President Xi Jinping.

White House spokesman Ben Rhodes said at the time that Obama had addressed concerns about cyber threats emanating from China. He said Obama told Xi the U.S. sees it not through the prism of security, but out of concern over theft of trade secrets.

In late March, Defense Secretary Chuck Hagel revealed that the Pentagon planned to more than triple its cybersecurity staff in the next few years to defend against Internet attacks that threaten national security.

Hagel's comments at the National Security Agency headquarters in suburban Washington came as he prepared to visit China.

"Our nation's reliance on cyberspace outpaces our cybersecurity," Hagel said at the time. "Our nation confronts the proliferation of destructive malware and a new reality of steady, ongoing and aggressive efforts to probe, access or disrupt public and private networks, and the industrial control systems that manage our water, and our energy and our food supplies."

The Associated Press contributed to this report.