Anthropic is accusing China's Alibaba of exploiting its AI models in a large-scale attack

Anthropic accused Alibaba of conducting the largest known distillation attack on its AI models, with 28.8 million exchanges through nearly 25,000 fraudulent accounts. Anthropic's policy head called for legislation to limit China's access to US computing infrastructure and penalize such attacks. Alibaba's shares dropped over 4% following the accusation.

Anthropic accused one of China's biggest tech companies of exploiting its advanced AI models. Anthropic's head of policy, Sarah Heck, said in a letter to South Carolina Sen. Tim Scott and Massachusetts Sen. Elizabeth Warren on June 10 that Alibaba had recently carried out "the largest known distillation attack" on it to date. Heck wrote in the letter, obtained by Business Insider, that Alibaba-affiliated operators tried to "illicitly extract Claude's capabilities" to train Alibaba's own models, and called for legislation to prevent further attacks. Between April 22 and June 5, the operators conducted "28.8 million exchanges with Claude through almost 25,000 fraudulent accounts," Heck wrote. Distillation attacks https://www.businessinsider.com/anthropic-mythos-made-wrong-tradeoff-new-model-guardrails-llm-development-2026-6 refer to using advanced AI models to train and improve the capabilities of less advanced models. Alibaba, a Chinese e-commerce behemoth, develops AI models under its Alibaba Cloud umbrella, including its Qwen LLMs. "These distillation attacks are carried out illicitly, systematically, and at industrial scale to harvest US AI capabilities across frontier labs and repackage them as their own without incurring the training and R&D costs required to train US frontier models," Heck wrote to the senators. She added that the attacks could help Chinese models reach Claude Mythos Preview-level https://www.businessinsider.com/claude-mythos-preview-anthropic-cybersecurity-reaction-glasswing-2026-4 capabilities sooner. Mythos is one of Anthropic's most advanced LLMs, capable of detecting software vulnerabilities and outperforming humans on cybersecurity tasks. She asked the senators for more legislation against distillation attacks, such as limiting China's access to advanced US computing infrastructure and penalizing Chinese entities that launch them. Anthropic's letter to lawmakers comes several weeks after the US government slapped an export control https://www.businessinsider.com/anthropic-disable-mythos-fable-us-export-control-national-security-2026-6 on its latest Fable 5 model, barring foreign individuals from accessing it and citing national security risks. This is the latest blow to Alibaba, which was also recently added to a Pentagon blacklist — a list of businesses the defense department linked to the Chinese military. On Tuesday, Alibaba sued the US government for this designation. As of press time on Thursday, Alibaba's share price has dropped more than 4%. Representatives for Alibaba did not respond to a request for comment from Business Insider.