DeepSeek aids China's military and evaded export controls, US official says: Reuters

AI firm DeepSeek is aiding China's military and intelligence operations, a elder U.S. official told Reuters, adding that the Chinese tech startup sought to use Southeast Asian ammunition companies to entree high-end semiconductors that cannot beryllium shipped to China nether U.S. rules.

The U.S. conclusions bespeak a increasing condemnation successful Washington that the capabilities down the accelerated emergence of 1 of China's flagship AI enterprises whitethorn person been exaggerated and relied heavy connected U.S. technology.

Hangzhou-based DeepSeek sent shockwaves through the exertion satellite successful January, saying its artificial quality reasoning models were connected par with oregon amended than U.S. industry-leading models astatine a fraction of the cost.

"We understand that DeepSeek has willingly provided and will apt proceed to supply enactment to China's military and intelligence operations," a elder State Department official told Reuters successful an interview.

"This effort goes above and beyond open-source entree to DeepSeek's AI models," the official said, speaking connected information of anonymity successful bid to talk astir U.S. authorities information.

The U.S. government's appraisal of DeepSeek's activities and links to the Chinese authorities person not been antecedently reported and come amid a wide-scale U.S.-China trade war.

Among the allegations, the official said DeepSeek is sharing user information and statistics with Beijing's surveillance apparatus.

The large 3 U.S. unreality providers Amazon, Microsoft and Alphabet's Google offer DeepSeek to customers.

Chinese instrumentality requires companies operating successful China to supply information to the authorities erstwhile requested. But the proposition that DeepSeek is already doing truthful is apt to rise privacy and other concerns for the firm's tens of millions of regular global users. The U.S. besides maintains restrictions connected companies it believes are linked to China's military-industrial complex.

U.S. lawmakers person antecedently said that DeepSeek, based connected its privateness disclosure statements, transmits American users' information to China done "backend infrastructure" connected to China Mobile, a Chinese state-owned telecommunications giant.

DeepSeek did not respond to questions astir its privateness practices.

The institution is besides referenced much than 150 times successful procurement records for China's People's Liberation Army and other entities affiliated with the Chinese defence concern base, said the official, adding that DeepSeek had provided exertion services to PLA probe institutions.

Reuters could not independently verify the procurement data.

The official also said the institution was employing workarounds to U.S. export controls to summation entree to precocious U.S.-made chips.

DeepSeek has entree to "large volumes" of U.S. steadfast Nvidia's high-end H100 chips, said the official. Since 2022 those chips person been nether U.S. export restrictions owed to Washington's concerns that China could use them to beforehand its military capabilities oregon leap up successful the AI race.

"DeepSeek sought to use ammunition companies successful Southeast Asia to evade export controls, and DeepSeek is seeking to entree information centers successful Southeast Asia to remotely entree U.S. chips," the official said.

The official declined to accidental if DeepSeek had successfully evaded export controls or connection further details astir the ammunition companies.

DeepSeek also did not respond to questions astir its acquisition of Nvidia chips oregon the alleged use of ammunition companies.

When asked if the U.S. would instrumentality further export controls or sanctions against DeepSeek, the official said the section had "nothing to denote astatine this time."

China's foreign ministry and commerce ministry did not respond to a Reuters petition for comment.

DeepSeek has said 2 of its AI models that Silicon Valley executives and U.S. tech institution engineers person showered with praise – DeepSeek-V3 and DeepSeek-R1 – are connected par with OpenAI and Meta's most precocious models.

AI experts, however, person expressed skepticism, arguing the existent costs of grooming the models were apt overmuch higher than the $5.58 cardinal the startup said was spent connected computing power.

Reuters has antecedently reported that U.S. officials were investigating whether DeepSeek had entree to restricted AI chips.

DeepSeek has H100 chips that it procured aft the U.S. banned Nvidia from selling those chips to China, 3 sources acquainted with the substance told Reuters, adding that the fig was acold smaller than the 50,000 H100s that the CEO of different AI startup had claimed DeepSeek possesses successful a January interrogation with CNBC.

Reuters was incapable to verify the fig of H100 chips DeepSeek has.

"Our reappraisal indicates that DeepSeek used lawfully acquired H800 products, not H100," an Nvidia spokesperson said, responding to a Reuters query about DeepSeek's alleged usage of H100 chips.

In February, Singapore charged 3 men with fraud successful a lawsuit home media have linked to the question of Nvidia's precocious chips from the metropolis authorities to DeepSeek.

China has besides been suspected of uncovering ways to use precocious U.S. chips remotely.

While importing precocious Nvidia chips into China without a licence violates U.S. export rules, Chinese companies are inactive allowed to entree those aforesaid chips remotely successful information centers successful non-restricted countries.

The exceptions are erstwhile a Chinese institution is connected a U.S. commercialized blacklist oregon the chip exporter has cognition that the Chinese steadfast is using its chips to assistance make weapons of wide destruction.

U.S. officials person not placed DeepSeek on immoderate U.S. commercialized blacklists yet and have not alleged that Nvidia had immoderate cognition of DeepSeek's enactment with the Chinese military.

Malaysia's commercialized ministry said past week that it was investigating whether an unnamed Chinese institution successful the state was using servers equipped with Nvidia chips for ample connection exemplary training and that it was examining whether immoderate home instrumentality oregon regularisation had been breached.