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FBI Director Christopher Wray speaks with Walter Russell Mead at Hudson Institute. (James O'Gara)

Over the last decade, China's economic espionage campaign against the United States has accelerated dramatically. With the FBI opening a new China-related espionage investigation every ten hours, China's actual and attempted theft of American technology has left no corner of the U.S. economy untouched.

This week, Hudson was joined by FBI Director Christopher Wray for a major speech on the FBI's efforts to combat China's economic espionage campaign against the United States.

In unprecedented detail, Director Wray outlined the range of methods used by the Chinese government to steal personal data and taxpayer-funded research, influence US politicians, bribe university professors and students, and hunt down critics on American soil. Hudson Distinguished Fellow Walter Russell Mead [[link removed]] joined Director Wray for a conversation on how the law enforcement community is fighting back against "one of the largest transfers of wealth in human history."

Read Wray's Remarks [[link removed]] Watch the Event [[link removed]]

Key takeaways from the speech are below but for now, stay safe, Weekend Readers.

Key Takeaways [[link removed]]

Highlighted excerpts from Director Wray's speech at Hudson Institute on July 7, 2020.

1. American adult? China has likely stolen your personal data: [[link removed]]

Did you have health insurance through Anthem or one of its associated insurers? In 2015, China’s hackers stole the personal data of 80 million of the company’s current and former customers. Or maybe you’re a federal employee—or you used to be one, or you applied for a government job once, or a family member or roommate did. Well, in 2014, China’s hackers stole more than 21 million records from OPM, the federal government’s Office of Personnel Management.

Why are they doing this? China has made becoming an artificial intelligence world leader a priority, and these thefts feed right into China’s development of artificial intelligence tools. Compounding the threat, the data China stole is of obvious value as they attempt to identify people to target for secret intelligence gathering. China is also using social media platforms—the same ones Americans use to stay connected or find jobs—to identify people with access to our government’s sensitive information and then target them to try to steal it.

2. Through the "Fox Hunt" program, China pursues Chinese nationals in the U.S.: [[link removed]]

Since 2014, Chinese General Secretary Xi Jinping has spearheaded a program known as “Fox Hunt.” China describes Fox Hunt as an international anti-corruption campaign—it’s not. Instead, Fox Hunt is a sweeping bid by General Secretary Xi to target Chinese nationals whom he sees as threats and who live outside China, across the world. We’re talking about political rivals, dissidents, and critics seeking to expose China’s extensive human rights violations.

Hundreds of the Fox Hunt victims they target live right here in the United States, and many are American citizens or green card holders. The Chinese government wants to force them to return to China, and China’s tactics are shocking. For instance, when it couldn’t locate one Fox Hunt target, the Chinese government sent an emissary to visit the target’s family here in the United States. The message they said to pass on? The target had two options: return to China promptly, or commit suicide. And what happens when Fox Hunt targets refuse to return to China? In the past, their family members in the United States and China have been threatened and coerced; and those back in China have even been arrested for leverage.

3. The FBI opens a new China espionage case every 10 hours: [[link removed]]

At this very moment, China is working to compromise American health care organizations, pharmaceutical companies, and academic institutions conducting essential COVID-19 research. We’ve now reached the point where the FBI is opening a new China-related counterintelligence case approximately every 10 hours. Of the nearly five thousand active FBI counterintelligence cases currently under way across the country, almost half are related to China.

4. American research is stolen through the Thousand Talents Program: [[link removed]]

Through its talent recruitment programs, like the Thousand Talents Program, the Chinese government tries to entice scientists to secretly bring our knowledge and innovation back to China—even if that means stealing proprietary information or violating our export controls and conflict-of-interest rules.

Take the case of scientist Hongjin Tan, for example, a Chinese national and American lawful permanent resident. He applied to China’s Thousand Talents Program, stole more than $1 billion worth of trade secrets from his former employer, an Oklahoma-based petroleum company, and got caught. A few months ago, he was convicted and sent to prison.

5. American universities are hot spots for theft: [[link removed]]

China pays scientists at American universities to secretly bring our knowledge and innovation back to China—including valuable, federally funded research. American taxpayers are effectively footing the bill for China’s own technological development. And we are seeing more and more of these cases.

In May alone, we arrested both Qing Wang, a former researcher with the Cleveland Clinic who worked on the genetics of cardiovascular disease, and Simon Saw-Teong Ang, a University of Arkansas scientist doing research for NASA. Both were allegedly committing fraud by concealing their participation in Chinese talent recruitment programs while accepting millions of dollars in American federal grant funding. That same month, former Emory University professor Xiao-Jiang Li pled guilty to filing a false tax return for failing to report the income he’d received through China’s Thousand Talents Program. Our investigation found that while Li was researching Huntington’s disease at Emory, he pocketed half a million unreported dollars from China.

In a similar vein, Charles Lieber, chair of Harvard’s Department of Chemistry and Chemical Biology, was indicted just last month for making false statements to federal authorities about his Thousand Talents participation. The United States has alleged that Lieber concealed from both Harvard and the NIH his position as a strategic scientist at a Chinese university—and the fact that the Chinese government was paying him, through the Wuhan Institute of Technology, a $50,000 monthly stipend, more than $150,000 in living expenses, and more than $1.5 million, to establish a laboratory back in China.

6. China influences US politicians with direct pressure and middlemen: [[link removed]]

Let’s say China gets wind that an American official is planning to travel to Taiwan—think a governor, a state senator, a member of Congress. China will sometimes start by trying to influence the American official overtly and directly. China might openly warn that if the American official travels to Taiwan, China will take it out on a company from that official’s home state by withholding the company’s license to manufacture in China [which could be] economically ruinous for the company.

If that doesn’t do the trick, [China will] sometimes turn to indirect, covert, deceptive influence efforts. China will work relentlessly to identify the people closest to the official—the people the official trusts most. China will then work to influence those people to act on China’s behalf as middlemen to influence the official. The co-opted middlemen may then whisper in the official’s ear and try to sway the official’s travel plans or public positions on Chinese policy. These intermediaries aren’t telling the American official that they’re Chinese Communist Party pawns—and worse still, some of these intermediaries may not even realize they’re being used as pawns, because they too have been deceived.

7. There has been a 13-fold increase in Chinese economic espionage cases: [[link removed]]

These cases were among more than a thousand investigations the FBI has into China’s actual and attempted theft of American technology—which is to say nothing of over a thousand more ongoing counterintelligence investigations of other kinds related to China. We’re conducting these kinds of investigations in all 56 of our field offices. And over the past decade, we’ve seen economic espionage cases with a link to China increase by approximately thirteen hundred percent.

Quotes have been edited for length and clarity

Download Director Wray's Remarks [[link removed]]

Go Deeper: China's Economic Espionage

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Timeline: Coronavirus and the Chinese Communist Party [[link removed]]

Starting with the surge of hospital patients in Wuhan on October 15 2019, this timeline focuses on the origins of the novel coronavirus, the Chinese Communist Party’s response, and efforts to shape the global narrative surrounding the pandemic. It is based on publicly available sources and is regularly updated as new information emerges.

Read [[link removed]]

How the U.S. Must Respond to China’s Exploitation of the COVID-19 Pandemic [[link removed]]

Of China’s largest 25 economic enterprises, all but two are state-owned, and both of those companies’ CEOs are Communist Party members, notes Seth Cropsey and Harry Halem in their article exploring how China is attempting to achieve the economic prosperity needed to support its urban class.

Read [[link removed]]

The Multitier Battle Against Chinese 5G Dominance [[link removed]]

China's telecoms success, Tom Duesterberg notes, is founded on certain tactics: subsidization of domestic producers, forced technology transfer and outright theft of intellectual property, restricting foreign competition from its huge internal market, and growing efforts to manipulate the patent system and international standards.

Watch [[link removed]]

A Conversation with Former Deputy Secretary of State Antony Blinken [[link removed]]

Former Deputy Secretary of State and Deputy National Security Advisor Antony Blinken joined Walter Russell Mead for a discussion on the global challenges posed by China and the trajectory of the Democratic Party’s foreign policy.

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