DOJ to Charge More Cases of Chinese Tech Theft Before Biden Takes Over, US Officials Say

The Justice Department plans to announce more indictments involving cases of Chinese technology theft before the Joe Biden administration takes over in January, top U.S. security officials said. Under the agency’s China initiative (see 2008130036), the U.S. has targeted and arrested Chinese nationals for trying to steal export-controlled technology, an effort that has resulted in more than 1,000 Chinese researchers leaving the country since July, said John Demers, the U.S. assistant attorney general for national security.

Demers, speaking during a Dec. 2 event hosted by the Aspen Institute, said the Chinese researchers began leaving this summer after a series of trade secret-related indictments and after the U.S. closed China’s Houston consulate. Recent indictments were filed against a university researcher for trying to steal controlled U.S. software (see 2008290001) and a Taiwanese chipmaker for trying to steal trade secrets from a U.S. semiconductor company to benefit China (see 2010290017).

Demers called the agency’s indictments “just the tip of the iceberg” and said more will be released in the next two months. “Honestly, the size of the iceberg is one that I don't know that we or other folks realized how large it was when we began down that road,” he said.

Demers and William Evanina, director of the National Counterintelligence and Security Center, said they expect the new administration to continue many of the same policy actions against China. Evanina said the intelligence the U.S. receives on China “is not going away” and urged incoming officials to continue to act on leads they receive from companies and universities. “More and more of those investigations are coming from businesses and academia to DOJ,” Evanina said. “That will continue in the new administration.”

Although Demers said he expects incoming Justice Department officials to continue the China initiative, he said the “big question” is whether other U.S. agencies will also recognize the threat. “What has really enabled our successes was we didn't get any pushback from the State Department, we didn’t get pushback from Congress and we didn’t get pushback from the [U.S. trade representative],” Demers said. “In fact, we got applause for what we were doing.”

Demers said the agency’s indictments allowed the U.S. to signal to China that they cannot steal U.S. technology without penalties. But he also said the U.S. needs to “have a better handle on who's coming into the country.” “There's no question that they were part of a Chinese government effort to send these individuals here and to send them here without disclosing their identities,” Demers said. “This wasn't a series of coincidences or a series of individuals who didn't understand their [visa] forms. They were part of something bigger.”

Evanina said he is proud of how the administration was able to spread awareness of Chinese technology theft not only among U.S. industry but also with European partners. He said the U.S. has shared its indictments with European allies to help them catch Chinese theft of intellectual property, 5G equipment, semiconductors and nanotechnology. “We've really come a long way the last two years in Europe,” he said.

A Chinese Foreign Ministry spokesperson said Demers’ accusations are “scarcely supported” and called the U.S. prosecutions “absurd.” “We hope the U.S. will denounce the narrow-minded, extreme thinking and stop regarding everyone as spies,” the spokesperson said Dec. 3, according to a translated transcript of a routine press conference.