Bloomberg finds more proof of hacked Supermicro hardware

The evidence of hardware spying was spotted by a security expert

"In light of your important leadership roles in Congress, we want to assure you that a recent report in Bloomberg Businessweek alleging the compromise of our servers is not true", Apple's vice president of information security George Stathakopoulos wrote in the letter.

Bloomberg, though, is continuing to stick to its story, and has now issued an update quoting security expert Yossi Appleboum as having discovered the same malicious components during his work for an unnamed United States telecommunications company.

"It would be fantastic for China if it could integrate internal storage, a CPU and wireless communications in such a tiny chip", Zhang Baichuan, a Chinese cybersecurity expert, told SCMP, adding, "The fact is, China's chip technology is still at a primary stage". Cable provider CenturyLink has denied being the subject of the story, and Engadget has learned that Comcast also isn't involved.

The source of that report is named: Yossi Appleboum, CEO of security specialists Sepio Systems.

A major telecommunications company discovered malicious chips from San Jose-based Supermicro Computer Inc. server about a month-and-a-half ago, according to a new report by Bloomberg Businessweek.

Supermicro, however, had some stuff to say that threw some shade at Bloomberg. Supermicro told Bloomberg it had no knowledge of the implant, marking the second time the hardware maker has denied knowing anything about the reported manipulations.

The Supermicro backdoor reported Tuesday was also the result of malicious hardware secretly implanted during its manufacture. What's more, "the alterations were found to have been made at the factory as the motherboard was being produced by a Supermicro subcontractor in China".

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This time, the attack was admittedly different, and the details revealed an "implant" in the server's ethernet connector, which triggered "unusual communications", which techies at the telecom company were unable to account for. Guangzhou is 90 miles upstream from Shenzhen, dubbed the 'Silicon Valley of Hardware, ' and home to giants such as Tencent Holdings Ltd. and Huawei Technologies Co. Ltd.

The tampered hardware was found in a facility that had large numbers of Supermicro servers, and the telecommunication company's technicians couldn't answer what kind of data was pulsing through the infected one, said Appleboum, who accompanied them for a visual inspection of the machine. It's not clear if the telecommunications company contacted the Federal Bureau of Investigation about the discovery. An FBI spokeswoman declined to comment on whether it was aware of the finding.

The pushback against Bloomberg's reporting has been truly extraordinary.

A news report claiming a compromise of US companies' supply chains by Chinese spies has triggered a thorough search in government and industry for evidence of the breach that has so far turned up nothing, according to a senior National Security Agency official, who expressed concern that the search was a distraction and potentially a waste of resources.

Besides the denials, critics have also complained that last week's article was based exclusively on anonymous sources who couldn't be adequately scrutinized.

The issue is sensitive given the tense state of relations between the US and China, not to mention the danger of stock market and information-technology panic if China's tight grip on the computer supply chain compromised a huge number of servers in sensitive corporate and government facilities. Some in China also noticed it was a standard component - one skeptical article circulating on WeChat was titled (in Chinese), "The "spy chips" that Bloomberg exposed?"

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