The FBI and NSA have accused Alibaba and other Chinese firms of orchestrating the large-scale theft of American AI trade secrets. Reports from September 8 and 9, 2026, allege these companies used model distillation techniques to extract proprietary capabilities from advanced U.S. models. These methods reportedly allowed the firms to bypass established security measures.
The U.S. Treasury Secretary announced that the government is considering sanctions against Chinese companies involved in the intellectual property theft. China’s Foreign Ministry rejected the allegations as baseless and urged international cooperation instead. The warnings highlight significant intellectual property risks and potential regulatory penalties for Alibaba.