China-Based Artificial Intelligence Companies Conducting Industrial-Scale Distillation Campaigns Against U.S. AI Companies

## Executive summary A joint NSA/CISA/FBI advisory reports that China‑based AI companies have executed industrial‑scale, targeted knowledge distillation campaigns since at least late 2024 to extract proprietary functionalities from U.S. frontier models (e.g., GPT, Claude, Gemini, Grok). The advisory names alleged actors (DeepSeek, Moonshot AI, Alibaba, MiniMax, StepFun, Z.AI), details sophisticated TTPs—such as transfer‑station API proxies, automated metadata sanitization, chain‑of‑thought extraction, and subscription pooling—and recommends enhanced detection, subtle response alterations, and cross‑organization intelligence sharing to mitigate economic and technological harm.