Anthropic, one of America’s most valuable artificial intelligence firms, has accused the Chinese e-commerce and technology giant Alibaba of “brazenly” and “illicitly” extracting the capabilities of its Claude AI model, in what it has branded the largest campaign of its kind yet seen.
In a letter to senior members of the US Senate Banking Committee, the San Francisco-based developer said operators linked to Alibaba conducted almost 29 million exchanges with Claude using roughly 25,000 fraudulent accounts. The activity, it said, ran between 22 April and 5 June and amounted to “the largest campaign to illicitly extract Claude’s capabilities” recorded to date, according to the company’s account first reported by CNBC.
The letter, addressed to committee chairman Tim Scott and ranking member Elizabeth Warren, urged Congress to penalise the companies behind such attacks and to tighten the measures designed to stop American technology being siphoned off by overseas rivals.
According to Anthropic, the operation relied on what are known as “distillation attacks”, a technique in which answers are extracted from a stronger AI model to train a weaker one, sidestepping the export controls that govern the sale of model weights themselves.
The Alibaba-linked operators are said to have targeted Claude’s most commercially valuable functions, among them agentic reasoning, software engineering proficiency and the ability to see longer, more complex tasks through to completion. Attacks of this kind, Anthropic argued, are now being run on an “industrial scale” so that Chinese firms can harvest American AI capabilities and repackage them as their own.
For Anthropic, the financial stakes are considerable. “Distillation attacks turn hundreds of billions of dollars in American investment and research and development into a massive subsidy for our geopolitical competitors,” the company wrote.
It is not the first time the firm has raised the alarm. In February, Anthropic said it had identified three separate “industrial-scale” distillation campaigns linked to the Chinese labs DeepSeek, Moonshot and MiniMax. The Alibaba episode, on its figures, dwarfs all three.
The letter also pointed to alleged activity that Anthropic said could threaten the US military, citing the Department of Defense’s assessment that Alibaba, alongside the carmaker BYD and the search firm Baidu, has ties to China’s armed forces.
The companies have rejected any such suggestion. Alibaba this month filed a lawsuit against the US government seeking removal from the Pentagon’s so-called 1260H list, which designates firms judged to be Chinese military companies. From 30 June, the Defense Department will be barred from buying goods or services from any listed business.
American developers have repeatedly accused Chinese competitors of using distillation to build rival systems at a fraction of the cost of training a frontier model from scratch. OpenAI, the maker of ChatGPT, has levelled similar claims in the past.
The accusations land at a delicate juncture for Anthropic. The company is widely regarded as a leading AI developer and, alongside OpenAI, is being tipped for a stock market debut that could rank it among the most valuable businesses in the world. OpenAI has already given staff a taste of the rewards on offer, with employees recently cashing out billions of dollars in a share sale.
Yet Anthropic’s frontier technology has also become a lightning rod for security concerns. Its most advanced models, including Mythos, have alarmed governments over their capacity to find and exploit weaknesses in computer systems, prompting finance ministers to warn that the technology could threaten the stability of the banking system. Those same capabilities sit at the heart of Washington’s tightening grip on who may access the models at all, with Britain among the governments seeking an exemption from a US ban on Anthropic’s most powerful systems.
For Britain’s small and medium-sized businesses, increasingly reliant on AI tools to compete with larger rivals, the dispute is a reminder that the technology underpinning their productivity gains is now bound up in a high-stakes contest between the world’s two largest economies, one in which the rules are still being written.
