Washington accuses Chinese AI firms of ‘systematic’ theft from US rivals

In a recent advisory, the US cyber defense agency has accused prominent Chinese artificial intelligence laboratories, such as DeepSeek and Moonshot AI, of systematically pilfering the capabilities of American AI models. This accusation comes as the two nations compete for technological dominance, with the advisory issued just before an anticipated meeting between President Donald Trump and Chinese President Xi Jinping at the White House, where AI could be a key topic of discussion.

The US government and American AI firms have previously accused Chinese AI companies of theft, employing a technique known as distillation.

Distillation involves training an AI model to replicate the output of a more powerful and sophisticated model. According to the advisory, Chinese firms are conducting large-scale knowledge distillation campaigns, which have become a fundamental aspect of their AI development strategy. This method allows Chinese companies to achieve shorter AI development timelines and lower financial expenditures compared to training a frontier model from scratch.

The advisory highlights several Chinese companies, including DeepSeek, Moonshot AI, Alibaba, MiniMax, StepFun, and Z.AI, that are allegedly using millions of exchanges and requests to unlawfully copy the functionalities of US models from industry leaders like OpenAI, Anthropic, Google, and xAI. While StepFun could not be reached for comment, Moonshot AI declined to address the allegations.

These actions are believed to have been orchestrated with the knowledge and approval of the Chinese government, and they have been ongoing since late 2024.

The US cyber defense agency warns that these actions are likely sanctioned at the highest levels of the Chinese government. As President Trump faces pressure to respond to the growing influence of Chinese AI models, some companies continue to prefer the more affordable US alternatives, such as those from Anthropic or OpenAI, over the powerful yet costly Chinese models.