U.S.-China Trade Talks Hit by Sophisticated Cyber Attack

Federal investigators are looking into a major cyberattack that targeted key figures involved in U.S.-China trade negotiations, in what experts say is the latest escalation in digital warfare between the two global powers.

The attack, which surfaced in July, began with a carefully crafted phishing email. The message appeared to come from Representative John Moolenaar, chairman of the House Select Committee on Strategic Competition between the United States and the Chinese Communist Party. It was sent to U.S. trade groups, law firms, and government agencies tied to trade discussions.

The email carried the subject line “Your insights are essential” and included an attachment disguised as draft legislation. But opening it would have unleashed malware designed to secretly give hackers long-term access to sensitive systems.

Cybersecurity experts have linked the operation to APT41, a notorious hacking group believed to work with Chinese intelligence. APT41 has a history of conducting both cybercrime for profit and state-sponsored espionage, making it one of the most dangerous threat actors operating today.

The timing of the attack was significant. It came just before high-stakes U.S.-China trade talks in Sweden, where negotiators agreed to a 90-day extension of the tariff truce. That extension could pave the way for a meeting between President Donald Trump and Chinese President Xi Jinping later this year.

Unlike smash-and-grab style cyberattacks, the malware here was built for persistence. Analysts say it was meant to maintain a foothold in victim networks over time, allowing attackers to quietly monitor sensitive discussions and strategies related to trade.

The scheme was uncovered when staffers from Moolenaar’s committee started receiving questions about the suspicious emails. Their concerns triggered a federal investigation now involving the FBI and U.S. Capitol Police.

For its part, the Chinese Embassy in Washington denied any involvement. A spokesperson said China “firmly opposes and combats all forms of cyber attacks and cyber crime,” accusing critics of making baseless accusations without evidence.

Authorities have not yet confirmed whether any systems were successfully compromised, but the investigation is ongoing.