Data Gathered Through TikTok Might Enable CCP to Undermine US Economy: Former State Department Official

Former U.S. Assistant Secretary of State David Stilwell, in Washington on June 21, 2022. Matthew Pearson/CPI Studios

Information collected through ubiquitous video app TikTok might enable the Chinese Communist Party (CCP) to undermine the U.S. economy, warns David Stilwell, former assistant Secretary of State for East Asia and the Pacific.

He said that if Americans’ purchasing preferences or information is revealed to TikTok, which would mean that it can be accessed by the CCP, the Chinese regime then can use that as leverage to “withhold those supply chain information ... or the difficulty we had with supply chains,” he said on “China in Focus” on NTD, a sister media outlet of the Epoch Times.

He pointed to a January 2022 report by Chainalysis on North Korea’s stealing of millions in crypto.

Cybercriminals linked to North Korea carried out at least seven attacks on cryptocurrency platforms last year, netting some $400 million in digital assets, according to blockchain analysis firm Chainalysis.

North Korea “is a systematic money launderer, and their use of multiple mixers—software tools that pool and scramble cryptocurrencies from thousands of addresses—is a calculated attempt to obscure the origins of their ill-gotten cryptocurrencies while offramping into fiat,” according to the Chainalysis report.

In February 2021, U.S. authorities charged three computer programmers linked to North Korea with a massive hacking spree aimed at stealing more than $1.3 billion in money and cryptocurrency from financial institutions and companies.

Stilwell said North Korea has been taking billions in cryptocurrency and using it for “their weapons, programs, their own economy and all that.”

“There’s nothing that prevents the PRC from doing that,” he said, referring to China’s official name, the People’s Republic of China.

“Every bit of this gives the PRC a hammer, a lever, that they can hit us over the head with that we don’t get in reverse because of the [CCP’s] Great Firewall,“ he added. ”Again, we should not allow the adversary to keep punching us while we simply hold our hands behind our back because our system doesn’t allow us to defend ourselves. We should defend ourselves.”

Untrustworthy

The former official noted that anything coming from the CCP is meant to be dual use.

“Anybody who says that this is a purely commercial activity, civilian, just some fun software, doesn’t understand the CCP or [CCP leader] Xi Jinping in China. Everything is dual use, everything has a connection to the communist party,” he said of TikTok.

Stilwell stressed that there is no civil or private industry in the communist state—everything has been subsumed under the CCP and exists to serve the party’s needs.

He dismissed TikTok’s proposed initiative, called “Project Texas,” which proposed the storage of all its U.S. user data on Oracle-based cloud infrastructure in the United States.

“Forty years, we believed everything the PRC said. We took it at face value, we wanted to believe that they were being square, upright, forthright, honest,“ Stilwell said. ”I think the pandemic went a long way to making us second-guess that. No human-to-human transmission? Of course there was. … It was out of control.”

“That in itself should have made Americans, especially our government, question anything that comes out of the CCP,” the former official said.

“And then you had the balloon debacle here recently,” he said of the Chinese spy balloon that floated over the entire U.S. continent, including part of Canada, for over a week before it was eventually shot down on Feb 4 over the Atlantic. “We clearly know that thing had nothing to do with weather. It was a surveillance [craft] lighter than an aircraft. How many of these do we have to go through until we stop believing, taking at face value?”

“This is how the system works in the PRC,“ he said. ”If you’re not cheating, you’re not trying. There are no penalties for lying, etc, etc. It’s a massive cultural difference between a trust-based society and a society that has no trust. We have to accede distrust.”

Amend the law

Amid growing calls to ban TikTok from lawmakers, Stilwell believed that Congress can amend the laws in a smart way to address the security threat from the Chinese app.

“We were dancing on this line of censorship and First Amendment freedoms. We have to be very careful with that. But we also have to defend ourselves. ... We can change our laws. The fact that Congress is engaged tells me all we have to do is amend our laws in a smart way. We can solve this,” Stilwell said.

Tom Ozimek contributed to this report.