US accuses Chinese AI firms of 'malicious' copying of AI technology

U.S. cyber and law enforcement officials accused Chinese ⁠AI companies on ⁠Tuesday of maliciously copying technology from sophisticated American-made AI models through a technique known as distillation, according to a ⁠statement from three U.S. security agencies.

Distillation is the process of training smaller AI models using output from larger, more expensive ones as part of an effort to lower the cost of training a new AI tool. The U.S. officials accused China's DeepSeek, Moonshot ⁠AI, ⁠Alibaba, MiniMax and StepFun of using variants of American-made AI models to train their AI products, according to a statement from the U.S. National Security Agency, the Cybersecurity and Infrastructure Security Agency, and the FBI. The companies did so "likely with ⁠Chinese government awareness," according to the agencies.

"China-based AI companies are engaging in aggressive, malicious and targeted distillation activities at an industrial scale," the officials said.

U.S. officials made the allegations as the Trump administration prepares for ⁠Chinese ‌President ‌Xi Jinping's visit to the U.S. ⁠in late September. ‌The U.S. and China are also gearing up to discuss AI ⁠safety risks during a ⁠dialogue planned for mid-September, Reuters previously reported.