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China urges banks to remove IBM computers in spy dispute

By Reuters
Tuesday, May 27, 2014 6:28 EDT
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The Chinese government is pushing domestic banks to remove high-end servers made by International Business Machines Corp and replace them with a local brand, the latest move by Beijing over U.S. spying claims, Bloomberg reported on Tuesday.

The news comes a day after China accused the United States of “unscrupulous” cyber surveillance that included large-scale computer attacks against the Chinese government and Chinese companies.

Government agencies, including the People’s Bank of China [CNBNK.UL] and the Ministry of Finance, are reviewing whether Chinese commercial banks’ reliance on the IBM servers compromises the country’s financial security, the report said citing people familiar with the matter.

A spokesman at the National Development and Reform Commission said the country’s top economic planner has not told companies to change their IBM servers, nor received orders from higher levels of the government to do so.

Officials at IBM were not immediately available for comment. The central bank and the finance ministry did not immediately respond to request for comment when contacted by Reuters.

The results of the government review will be submitted to a working group on Internet security chaired by Chinese President Xi Jinping, Bloomberg reported.

Sources at China’s “big four” state-owned banks said they had no knowledge of the reported pressure for a technology change, saying any replacement of banks’ systems is not an easy task.

“We haven’t heard about the order,” an official at one of the bank’s IT department said, declining to be identified because he is not allowed to speak to the media.

“There aren’t any locally made hardware around that can handle the massive amount of data in the banking industry.”

China told its state-owned enterprises to sever links with American consulting firms just days after the United States charged five Chinese military officers with hacking U.S. companies, the Financial Times reported on Sunday.

Reuters
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