WASHINGTON—U.S. intelligence agencies have pinpointed many of the Chinese groups responsible for cyberspying in the U.S., and most are sponsored by the Chinese military, according to people who have been briefed on a U.S. intelligence investigation.
Armed with this information, the U.S. has begun to lay the groundwork to confront China more directly about its expansive cyberspying campaign. Two weeks ago, U.S. officials met with Chinese counterparts and warned China about the diplomatic consequences of economic spying, according to a former official familiar with the meeting.
The Chinese cyberspying campaign stems largely from a dozen groups connected to China's People's Liberation Army and a half-dozen nonmilitary groups connected to organizations like universities, said those who were briefed on the investigation. Two other groups play a significant role, though investigators haven't determined whether they are connected to the military.
In many cases, the National Security Agency has determined the identities of individuals working in these groups, which is a critical development that provides the U.S. the option of confronting the Chinese government more directly about the activity or responding with a counterattack, according to former officials briefed on the effort.
"It's actually a small number of groups that do most of the PLA's dirty work," said James Lewis, a cybersecurity specialist at the Center for Strategic and International Studies who frequently advises the Obama administration. "NSA is pretty confident of their ability to attribute [cyberespionage] to this set of actors."
In early November, the U.S. chief of counterintelligence issued a report that was unusually blunt in accusing China of being the world's "most active and persistent" perpetrator of economic spying. Lawmakers have also become more vocal in calling out China for its widening campaign of cyberespionage.
Still, diplomatic considerations may limit the U.S. interest in taking a more confrontational approach because some U.S. officials are wary of angering China, the largest holder of U.S. debt. Chinese officials regularly dispute U.S. allegations of cyberspying, saying they are the victims, not the perpetrators, of cybercrime and cyberespionage.
Identifying adversaries has been difficult because it is easy to fake identities and locations in cyberspace. An inability to tie cyberspying activities with precision to a certain actor has in the past limited the U.S.'s ability to respond because it is hard to retaliate or confront an unidentified adversary.
The U.S. government, led by the National Security Agency, has tracked the growing Chinese cyberspying campaign against the U.S. for decades. Past government efforts have had exotic names like "Titan Rain," and "Byzantine Hades.
"More recently, NSA and other intelligence agencies have made significant advances in attributing cyberattacks to specific sources—mostly in China's People's Liberation Army—by combining cyberforensics with ongoing intelligence collection through electronic and human spying, Mr. Lewis said.
The U.S. investigation of China's activities is the latest round of spy-versus-spy in cyberspace.
The activity breaks down into cyberspying efforts by 20 groups with different attack styles that are responsible for most of the cybertheft of U.S. secrets, said the people briefed on the investigation. U.S. intelligence officials have given different classified code names to each group.
U.S. intelligence officials can identify different groups based on a variety of indicators. Those characteristics include the type of cyberattack software they use, different Internet addresses they employ when stealing data, and how attacks are carried out against different targets. In addition to U.S. government agencies, major targets of these groups include U.S. defense contractors, according to former officials.
Collectively, these groups employ hundreds of people, according to former officials briefed on the effort. That number is believed to be small compared to the estimated 30,000 to 40,000 censors the Chinese government is believed to employ to patrol the Internet.