On Thursday, the Donald Trump administration accused China-linked entities of carrying out large-scale theft of U.S. artificial intelligence technology, warning of stronger enforcement measures against what it describes as unauthorized “distillation” of frontier AI models.
US Alleges Coordinated AI Model Copying Effort
In a memo, Michael Kratsios, director of the White House Office of Science and Technology Policy, said the administration has intelligence indicating that foreign actors, primarily based in China, are running “industrial-scale campaigns” aimed at replicating advanced U.S. AI systems.
Kratsios said these efforts involve extracting knowledge from leading American AI models and using it to build competing systems at lower cost, calling the activity an “unacceptable” threat when conducted without authorization.
“The United States government has information indicating that foreign entities principally based in China, are engaged in deliberate, industrial-scale campaigns to distil US frontier AI systems,” he wrote.
Distillation At Center Of AI Security Concerns
The practice, known as distillation, is a standard AI technique used to create smaller, efficient models.
U.S. AI companies, including Anthropic and OpenAI, have previously raised growing concerns that distillation efforts by Chinese groups could erode America’s technological lead.
Kratsios said such campaigns often rely on “tens of thousands of proxy accounts” and other methods to evade detection while attempting to extract proprietary model behavior.
National Security And Industry Response
Chris McGuire of the Council on Foreign Relations told the Financial Times that Chinese firms are using distillation to “offset deficits in AI computing power and illicitly reproduce the core capabilities of U.S. models.”
Crackdown And Policy Measures
The administration said it will share intelligence with AI companies, strengthen coordination, and explore sanctions or export restrictions against entities involved.
The White House’s official X handle shared the memo on social medi and also said, “The Trump Administration will not allow China to subvert American interests by stealing AI,” signaling a tougher stance as tensions rise ahead of U.S.-China talks.