Sen. Whitehouse plans future cyber hearing on prosecuting trade secret theft

Sen. Sheldon Whitehouse (D-R.I.) on Wednesday said he plans to hold a future hearing on the resources the Justice Department has in place to prosecute the cyber theft of American intellectual property and take action against botnets.

At a Senate Judiciary Committee oversight hearing on the Justice Department, Whitehouse said he couldn't recall a "single" cyber prosecution case against hackers that stole an American company's intellectual property through a cyberattack unleashed via the Web. He noted that most cyber espionage cases have included some physical piece of evidence, such as a charges brought against someone caught with proprietary data loaded on a "CD in their pocket leaving the factory."

"I think anybody who has been in the trenches understands how immensely complicated and resource-intensive these cases are," said Whitehouse, who chairs of the Senate Judiciary subpanel on crime and terrorism. "I think in a time of diminishing budgets and budget pressures, it's important we focus a real light on what the resources are that are required to make these cases and how important they are."

Attorney General Eric Holder said the department would be willing to participate and send witnesses to such a hearing.

"I actually think that interaction could be particularly useful as we try to explain the issues that we confront in bringing these cases, the resource issues that we have, [and] frankly also to hear suggestions" Holder said.

In a later exchange with Sen. Chris Coons (D-Del.), Holder described the cyber theft of American intellectual property and trade secrets as "devastating" to the economy and a threat to the country's national security.

Holder said the government needs to devote more attention to the problem because it's "large and getting larger."

Seth Larson, a spokesman for Whitehouse, said the senator hopes to hold a hearing on the Justice Department's strategy towards combating botnets and prosecuting cyber theft this spring, but will consult with subcommittee ranking member Sen. Lindsey Graham (R-S.C.) before finalizing any plans. He added that Whitehouse expects to invite representatives from the Justice Department (DOJ) and FBI to testify. 

"Broadly, Senator Whitehouse has been interested in questions such as: how DOJ and FBI investigate cases and decide which cases to pursue, how those investigations are staffed (e.g. whether expertise is distributed around the country or centralized), how DOJ and the FBI proceed when foreign threats are identified, whether DOJ and FBI have adequate statutory authorities (particularly with respect to botnets), and whether staffing levels are adequate,” Larson said in a email.

Earlier in this week, Whitehouse said international hackers should face stiffer penalties for stealing trade secrets from American companies in a letter sent to the U.S. Sentencing Commission. He noted that current guidelines suggest zero to six months in prison for first-time offenders.

"Such limited sentences are inappropriate considering the damage caused by the theft of trade secrets by cyber means," Whitehouse wrote.

The cyber theft of intellectual property and trade secrets has gained national attention in recent weeks following reports about a spate of cyberattacks on American companies such as Apple, Facebook, Twitter and Microsoft. In many cases, China has been considered the culprit of recent cyberattacks, a charge the country denies.

Amid this hacking reports, the administration recently released a strategy aimed at pressuring other countries to stop hacking into U.S. companies.

House Intelligence Chairman Mike Rogers (R-Mich.) has accused China of waging an extensive cyber espionage campaign against American companies. The administration needs to step up its efforts to confront China about these cyberattacks, he argued.

"If they truly want to be an international player, they have to stop acting like a thief in the night, and we need to make that point," Rogers said during an interview last week.

— This post was updated at 3:45 p.m.