Washington accuses Chinese AI firms of ‘systematic’ theft

The United States has accused prominent Chinese artificial intelligence companies, such as DeepSeek and Moonshot AI, of systematically stealing the capabilities of American AI models. This allegation comes as the two nations compete for technological superiority. The warning was issued by the US cyber defense agency and coincides with a potential meeting between President Donald Trump and his Chinese counterpart, Xi Jinping, at the White House, where AI may be a focal point.

The advisory highlights that Chinese AI firms are systematically extracting proprietary functionalities and capabilities of US AI models through a process known as distillation. Distillation involves training an AI model to replicate the output of a larger, more capable model, a technique commonly used in the industry but allegedly deployed at an industrial scale by Chinese firms to illicitly replicate American systems.

Washington claims that Chinese companies, including DeepSeek, Moonshot AI, Alibaba, MiniMax, StepFun, and Z.AI, have employed this strategy extensively, using millions of exchanges and requests to steal capabilities from US models developed by OpenAI, Anthropic, Google, and xAI. These actions, likely with Chinese government knowledge, began at least as early as late 2024.

The advisory did not reach out to Chinese companies for comment, with Moonshot AI declining to respond. The White House is under pressure to respond to the growing popularity of Chinese AI models, which many prefer over the pricier, yet less powerful US alternatives from companies like Anthropic and OpenAI. In July, a group of startups wrote to the Trump administration urging caution against outright bans or strict restrictions on foreign-made AI models, suggesting such measures should only apply to government use.

Beijing recently accused US AI companies of using Chinese examples to train their models. When confronted about the accusations on Wednesday, Chinese foreign ministry spokeswoman Mao Ning stated that China should refrain from making unfounded accusations against and smearing China, emphasizing that China's AI development is a result of achieving self-reliance and technological strength.

She added that both China and the United States are major players in AI and should strengthen cooperation.