US artificial intelligence giant Anthropic has accused Chinese e-commerce and technology firm Alibaba of "brazenly" and "illicitly" extracting its Claude AI model's capabilities, according to a BBC report. In a letter dated 10 June and addressed to US Senators Tim Scott and Elizabeth Warren, the San Francisco-based company alleged that operators linked to Alibaba carried out almost 29 million exchanges with Claude using thousands of fraudulent accounts in what it called the largest extraction campaign of its kind.
The Allegation
Anthropic described the campaign as "the largest campaign to illicitly extract Claude's capabilities," according to the BBC. The company said the attacks were carried out through "distillation attacks," a method that extracts answers from a stronger AI model to train a weaker one. The operators targeted Claude's most valuable capabilities, including its ability to tackle longer and more complex tasks and its approach to decision-making.
Anthropic's letter urged Congress to penalise the companies behind such attacks and to ramp up measures to prevent US technology from being stolen. The BBC reported that Anthropic also cited other alleged attacks that posed a threat to the US military. The company stated: "Distillation attacks turn hundreds of billions of dollars in American investment and [research and development] into a massive subsidy for our geopolitical competitors."
| Aspect | Detail |
|---|---|
| Number of exchanges | Almost 29 million |
| Fraudulent accounts | Thousands |
| Attack method | Distillation attacks (extracting answers from a stronger model to train a weaker one) |
| Targeted capabilities | Longer and more complex tasks, decision-making |
| Letter recipient | US Senators Tim Scott and Elizabeth Warren |
How Distillation Attacks Work
According to the BBC, distillation attacks enable Chinese companies to harvest and repackage US AI capabilities as their own on an "industrial scale." US developers have previously accused Chinese competitors of using this technique to train their models to rival American AI technology at a fraction of the cost. OpenAI has also previously accused Chinese groups of employing the same practice, the BBC noted.
Broader Context of US-China AI Rivalry
The BBC report also noted that Anthropic cited the US Department of Defense's claims that Alibaba and several major firms like car maker BYD and tech company Baidu are tied to the Chinese military. The companies have denied any such allegations. Alibaba this week sued the US government in a bid to get its name removed from the Pentagon blacklist.
Anthropic is a leading AI developer and, alongside ChatGPT-maker OpenAI, is gearing up for a blockbuster stock market debut that could make it one of the most valuable companies in the world. However, some of Anthropic's more advanced models, such as Mythos, have raised cybersecurity concerns over their ability to target weaknesses in computer systems, according to the BBC.
Enterprise Implications
For enterprise technology decision-makers, the incident underscores significant risks in AI supply chains. Distillation attacks not only involve IP theft but also threaten the integrity of AI systems that businesses increasingly rely on. The alleged scale of the campaign—29 million exchanges—suggests a sophisticated, persistent effort to undermine US AI leadership. As companies integrate models like Claude into their operations, they must assess the provenance of training data and the security of AI interfaces to prevent exploitation. The call for Congressional action highlights the need for stronger legal frameworks to protect AI investments, a factor that will influence procurement strategies and vendor risk assessments in the coming years.
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