US Intelligence Agencies Accuse Six Chinese AI Firms of Systematically Copying American Models

The NSA, the FBI and CISA issued a joint advisory on Tuesday accusing six China-based artificial intelligence companies of extracting proprietary capabilities from American models at industrial scale. The named firms are DeepSeek, Moonshot, Alibaba, MiniMax, StepFun and Z.AI, Bloomberg reported.

The agencies describe a technique called distillation, in which one model is trained on the outputs of another. They say the companies pulled billions of tokens across millions of requests from Claude, GPT, Gemini and Grok since at least late 2024, often through proxy services and multiple accounts to avoid detection, according to NBC News. Moonshot, whose Kimi model moved markets earlier this year, is separately accused of using data from American systems to train later versions, CoinDesk reported. The agencies said the activity likely occurred with the Chinese government's awareness. The named companies have not publicly accepted the characterization, and the advisory presents conclusions rather than published evidence.

There is also a commercial question behind the security one. If a competitive model can be built largely from another model's outputs, the cost advantage of spending tens of billions of dollars on training runs is smaller than the capital being deployed assumes. That is a claim about returns on capital, and it applies to every company financing an AI buildout on the expectation that scale alone protects its lead.