Chairman Mike Gallagher (R-WI) of the House Select Committee on the Chinese Communist Party wrote to the CEO of the U.S. Navy Exchange, requesting the removal of Lenovo products from the discounted marketplace available to servicemembers.
Hong Kong based Lenovo is the world's largest PC vendor and third largest smartphone company. In the second quarter of 2023, Lenovo had a market share of 24 percent of global PC shipments. In 2005 Lenovo acquired the former Personal Computer Division of IBM, the company that invented the PC industry in 1981.
Lenovo was started in 1984 by Liu Chuanzhi with 11 colleagues and 200,00 yuan ($28,600) in seed capital from the Chinese Academy of Sciences. The original company started out as an agent selling foreign-made PCs and as a developer of a Chinese character software system. The founders went on to use the money from their businesses to develop their own brand, which was originally called Legend in English. The company later changed its name to Lenovo in 2004.
Currently, the U.S. Navy Exchange offers at least ten Lenovo computer and IT products. In the letter, Chairman Gallagher writes, "[T]he Exchange should not be selling Lenovo products to U.S. servicemembers, let alone incentivizing such purchases with tax-free, discounted prices. Doing so creates a major cybersecurity threat and undermines the U.S. Department of Defense’s 2023 Cyber Strategy, which commits to “foster[ing] a culture of cybersecurity and cyber awareness."
Chairman Gallagher cited the Pentagon's 2016 warning that Lenovo computers could introduce compromised hardware into the Defense Department. In 2018, the FTC also cautioned that Lenovo installed software on U.S.-bound computers that created serious security vulnerabilities.
Chairman Gallagher requested that Robert Bianchi, CEO of the Navy Exchange, provide a briefing no later than October 20, 2023 on the Navy Exchange's decision to sell Lenovo computers and IT products.
Click HERE to view a copy of the letter or read below.
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