A senior US government official announced that AI company 'DeepSeek' is providing user data to the Chinese government beyond the scope of open source to support military and intelligence activities
Chinese AI startup DeepSeek has been providing information to the Chinese government that goes beyond open source, a senior U.S. government official told Reuters, and the company has also been accused of using shell companies in Southeast Asia to circumvent U.S. restrictions on AI chip exports.
Exclusive: DeepSeek aids China's military and evaded export controls, US official says | Reuters
US official implicates DeepSeek for supporting Chinese military and evading sanctions
https://www.cryptopolitan.com/us-accuse-deepseek-chinese-sanctions-evasion/
DeepSeek, a Chinese AI startup, released ' DeepSeek-R1 ' in January 2025. DeepSeek was promoted as having operating costs of only 3% of OpenAI o1, OpenAI's large-scale language model (LLM).
How did DeepSeek beat OpenAI's O1 at 3% of the cost? - GIGAZINE
According to a senior US State Department official who spoke to Reuters on condition of anonymity, DeepSeek's business goes beyond simply providing an open-source version of its AI. The source said DeepSeek is 'willing to assist and provide, and will likely continue to provide, personal information about its users' to China's People's Liberation Army and intelligence agencies.
DeepSeek also supported the People's Liberation Army's research institutes, according to internal procurement records that have been cited more than 150 times. A senior administration official said DeepSeek was providing the Chinese government with much more than open access to its AI models.
Chinese law requires domestic technology companies to voluntarily provide data if requested by the government, but 'if Reuters' report is true, it could have a devastating effect on DeepSeek's millions of users around the world,' tech outlet Cryptopolitan reported.
In addition, government officials have alleged that DeepSeek shares demographic and personal information about its users with Beijing's surveillance network. US lawmakers have previously accused DeepSeek of sharing personal information about US users with the government through back-end links linked to China Mobile, the state-owned telecommunications company.
Based on this report, a bill to ban DeepSeek on government devices is being discussed in the United States.
Anti-DeepSeek bipartisan bill 'Ban DeepSeek on Government Devices' submitted to the US House of Representatives - GIGAZINE
At the time of writing, DeepSeek has declined to comment on such privacy concerns, so it is unclear how much information is actually being provided to the Chinese government.
The United States is strengthening regulations to block the export of high-performance GPUs to China from 2022 onwards. This is a measure taken out of fear that China will use AI for military purposes.
However, the US government official said that DeepSeek had set up shell companies in Southeast Asia to smuggle high-performance GPUs, which are banned from being imported into China. The US State Department has not said whether DeepSeek's plan was successful.
It was reported as early as February 2025 that DeepSeek may have smuggled high-performance semiconductors that are subject to export controls to China.
The United States is investigating whether DeepSeek may have imported embargoed NVIDIA high-performance GPUs via Singapore - GIGAZINE
However, DeepSeek claims that it develops and operates its AI using only legally acquired H800 chips, and not H100 chips, which are subject to regulations. On the other hand, three people briefed on the matter said that DeepSeek is breaking regulations and procuring high-performance semiconductors on its own.
In fact, in March 2025, a person was arrested in Singapore for smuggling NVIDIA chips, but at the time of writing, DeepSeek has not been blacklisted by the US government, nor has NVIDIA been accused of knowingly conspiring with smugglers. However, it is clear that the US has a distrust for Chinese AI technology.
When asked about new sanctions or tougher export controls against DeepSeek, a senior government official who spoke to Reuters said, 'We have nothing to announce at this time.' Meanwhile, U.S. restrictions have prevented NVIDIA from entering the Chinese data center market, which is likely to be dominated by Chinese companies such as Huawei.
While some in Silicon Valley's AI industry have praised DeepSeek's V3 and R1 models, many others are skeptical, pointing out that the costs of development may far exceed the 'low development costs' DeepSeek touts. Questions have also been raised about how a young startup was able to assemble sophisticated hardware in the face of strict export controls.
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