U.S. Arrests Chinese Intelligence Officer for Economic Spying

Elias Hubbard
October 11, 2018

The Justice Department on Wednesday announced the arrest of a Chinese intelligence officer who was charged with economic espionage against US aviation companies.

In one instance, Mr. Xu, using an alias, contacted a GE Aviation engineer asking him to give a presentation on engine structure design at a Chinese University, according to the indictment.

So what makes the Xu case special is that it appears to mark the first time that an alleged Chinese intelligence officer has been brought to the U.S.to face charges. Xu worked with a conspirator, unnamed in the indictment, who contacted an engineer of the firm past year and offered to pay for a trip to China so the employee could talk about his work in connection with an event sponsored by a science and technology association, according to prosecutors.

The move is in line with a new law passed in August - the Foreign Investment Risk Review Modernisation Act of 2018 (or FIRRMA) - in response to warnings from intelligence officials that advanced USA technology transferred to Chinese companies through acquisitions and other means may have undercut the American military's advantages over China. "We will not tolerate a nation that reaps what it does not sow." said Assistant Attorney General John Demers in the press release.

Beginning in December 2013 and continuing until his April 1 arrest in Belgium, Xu targeted experts working for aeronautics companies inside and outside the United States, including Cincinnati-based GE Aviation, officials said.

"This case is not an isolated incident".

The indictment returned by a federal grand jury in the Southern District of OH details the interaction between Mr. Xu and two employees of USA companies.

Xu faces a maximum penalty of 15 years imprisonment for economic espionage charges and 10 years for charges pertaining to theft of trade secrets.

In April this year, while traveling to Belgium to meet with the employee and receive the sensitive information he wanted, Xu was arrested.

This is the latest in a string of economic espionage cases involving Chinese nationals stealing information beneficial to Beijing-though an indictment of an intelligence officer within the Chinese Communist Party is rare. This is the American way.

"Innovation in aviation has been a hallmark of life and industry in the United States since the Wright brothers first designed gliders in Dayton more than a century ago", said US Attorney Benjamin Glassman today.

A report by the National Counterintelligence and Security Center, a DNI component, made public last summer said China is engaged in aggressive cyber operations to steal valuable US technology and economic secrets. Last week Vice President Pence accused Chinese security agencies of "mastermind [ing] the wholesale theft of American technology".

"Chinese companies and individuals often acquire US technology for commercial and scientific purposes", the report states.

The report also said the problem of Chinese spying is enduring and systemic.

The U.S. administration has pointed to this plan as evidence that Beijing has systematically stolen intellectual property from U.S. companies to advantage itself-and the reason why the United States is enacting punitive tariffs on Chinese imports.

Xu's arrest also highlights the deception of Chinese leaders in providing false promises to the United States.

Other reports by Click Lancashire

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