U.S. intelligence agencies have issued a stern warning to Americans: Do not buy smartphones made by Chinese tech companies Huawei or ZTE.
Top officials from the CIA, NSA, FBI and the Defense Intelligence Agency testified in front of the Senate Intelligence Committee on Tuesday that the Chinese smartphone makers posed a security threat to American customers.

Republican Senator Tom Cotton of Arkansas asked the group to raise their hands if they would recommend private American citizens use products or services made by Apple competitor Huawei or smartphone maker ZTE. None of them did.

FBI Director Chris Wray explained why it is an issue for companies and local governments to use Huawei or ZTE products and services.

There is a risk of letting any company "beholden to foreign governments" inside the country's telecommunications infrastructure, he said. Huawei is a global leader in networking equipment, and the government has previously blocked it from selling technology to some federal agencies.

"It provides the capacity to maliciously modify or steal information," Wray said. "And it provides the capacity to conduct undetected espionage."

Huawei has not made strides in the U.S. market in large part because of government concerns that the Chinese government can use its smartphones and other products for intelligence gathering.

In 2012, Congress released a report saying the two Chinese companies should be viewed "with suspicion." The companies both strongly disputed the reports' findings at the time, with Huawei calling them "baseless."

In January, talks between Huawei and AT&T to sell its smartphones fell through. On Tuesday, Wray praised the efforts of telecommunications providers that are trying to "raise awareness on this issue."

Huawei said in a statement Wednesday that it is "monitoring developments" in Congress, but it declined to comment directly on the intelligence committee hearing.

The company highlighted its strong position in many markets outside of the U.S. Its phones outsell Apple's in places like Central and Eastern Europe, according to research firm Canalys.

"We operate in 170 countries where there is trust with governments and customers. We pose no greater cybersecurity risk than other vendors," Huawei said.

The company insisted it "has never been asked to provide access to our technology, or provide any data or information on any citizen or organization to any government, or their agencies."

ZTE said in a statement that its mobile phones and devices incorporate chipsets and other components manufactured in the U.S.

"As a publicly traded company, we are committed to adhering to all applicable laws and regulations of the United States, work with carriers to pass strict testing protocols, and adhere to the highest business standards," a representative for ZTE said in an emailed statement.

Cotton introduced a bill last week that would prohibit the government from contracting with companies that use Huawei or ZTE products. It's a companion bill to the "Defending U.S. Government Communications Act" put forth in the House last month. In 2013, Congress passed a law that prevented some federal agencies from buying tech from these firms without approval.

It's the latest push by Congress to prohibit foreign-made products due to intelligence concerns. For instance, the Russia-based Kaspersky Lab has been banned from federal computers.

Published Date:2018-02-15