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Bessent warns China could face sanctions over AI IP theft

The administration will examine whether Chinese open-weight models were trained on stolen U.S. model outputs, as Anthropic and OpenAI have raised similar concerns.

  • On Tuesday, Treasury Secretary Scott Bessent announced the Trump administration will investigate Chinese AI models for intellectual property theft, threatening sanctions against companies building offerings on "stolen materials."
  • Anthropic alleged that Chinese tech giant Alibaba conducted "the largest known distillation attack" to extract capabilities from Claude, using thousands of fraudulent accounts to evade detection and violate service terms.
  • Operators linked to Alibaba conducted approximately 28.8 million interactions with Claude models between April 22 and June 5 using roughly 25,000 fraudulent accounts, according to Anthropic's June 10 letter.
  • Washington and China plan to hold talks regarding artificial intelligence in September, with Bessent representing the American government while companies including Alibaba and ByteDance have participated in similar discussions.
  • Industry experts note distillation is standard practice used globally, and tech leaders warn that government intervention could create market uncertainty or stifle broader AI innovation.
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(Seoul = Yonhap News) Reporter Seol Won-tae = U.S. Treasury Secretary Scott Besant on the 21st (local time) closely examined China's open-source artificial intelligence (AI) models and U.S. [government]...

·Seoul, Korea (the Republic of)
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IBTimes broke the news in New York, United States on Tuesday, July 21, 2026.
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