The Invasion of the Chinese Cyberspies

An exclusive look at how the hackers called TITAN RAIN are stealing U.S. secrets

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Carpenter thought he was making progress. When he uncovered the Titan Rain routers in Guangdong, he carefully installed a homemade bugging code in the primary router's software. It sent him an e-mail alert at an anonymous Yahoo! account every time the gang made a move on the Net. Within two weeks, his Yahoo! account was filled with almost 23,000 messages, one for each connection the Titan Rain router made in its quest for files. He estimates there were six to 10 workstations behind each of the three routers, staffed around the clock. The gang stashed its stolen files in zombie servers in South Korea, for example, before sending them back to Guangdong. In one, Carpenter found a stockpile of aerospace documents with hundreds of detailed schematics about propulsion systems, solar paneling and fuel tanks for the Mars Reconnaissance Orbiter, the NASA probe launched in August. On the night he woke at 2, Carpenter copied a huge collection of files that had been stolen from Redstone Arsenal, home to the Army Aviation and Missile Command. The attackers had grabbed specs for the aviation-mission-planning system for Army helicopters, as well as Falconview 3.2, the flight-planning software used by the Army and Air Force.

Even if official Washington is not certain, Carpenter and other network-security analysts believe that the attacks are Chinese government spying. "It's a hard thing to prove," says a network-intrusion-detection analyst at a major U.S. defense contractor who has been studying Titan Rain since 2003, "but this has been going on so long and it's so well organized that the whole thing is state sponsored, I think." When it comes to advancing their military by stealing data, "the Chinese are more aggressive" than anyone else, David Szady, head of the FBI's counterintelligence unit, told TIME earlier this year. "If they can steal it and do it in five years, why [take longer] to develop it?"

Within the U.S. military, Titan Rain is raising alarms. A November 2003 government alert obtained by TIME details what a source close to the investigation says was an early indication of Titan Rain's ability to cause widespread havoc. Hundreds of Defense Department computer systems had been penetrated by an insidious program known as a "trojan," the alert warned. "These compromises ... allow an unknown adversary not only control over the DOD hosts, but also the capability to use the DOD hosts in malicious activity. The potential also exists for the perpetrator to potentially shut down each host." The attacks were also stinging allies, including Britain, Canada, Australia and New Zealand, where an unprecedented string of public alerts issued in June 2005, two U.S. network-intrusion analysts tell TIME, also referred to Titan Rain--related activity. "These electronic attacks have been under way for a significant period of time, with a recent increase in sophistication," warned Britain's National Infrastructure Security Co-Ordination Center.

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