Six Chinese Nationals Indicted for Stealing US Trade Secrets

Six Chinese nationals including university professors have been charged in the US with economic espionage and theft of trade secrets, in a case likely to further heighten tensions between the two superpowers.

The 32-count indictment, which was unsealed on Tuesday, alleges that Wei Pang and Hao Zhang met at a Californian university while studying doctorates in electrical engineering – specifically working on DARPA-funded R&D projects into thin-film bulk acoustic resonator (FBAR) technology.

FBAR works to filter out radio interference in smartphones, tablets and the like and has “numerous applications for a variety of military and defense communications technologies,” according to a Department of Justice note.

After completing their studies, the two went to work on FBAR projects at Avago Technologies and Skyworks Solutions. But in 2006 and 2007 they are accused – along with their co-conspirators – of eliciting interest in their work from state-backed Tianjin University and other organizations.

The university agreed to support their plan and in 2009 they resigned from their jobs, accepting full time roles as professors at Tianjin and later forming a JV with the university under the name ROFS Microsystems to “mass produce” FBAR, the DoJ note continued.

The six Chinese nationals are accused of stealing “recipes, source code, specifications, presentations, design layouts” and other confidential and proprietary documents from the two firms - sharing and using them to build a state-of-the-art facility for ROFS and win commercial and military contracts for FBAR products.

Hao Zhang was arrested on 16 May on entering the US from China, although it was not immediately clear whether the other conspirators have been arrested or are still in the PRC. The charges amount to 50 years in prison and fines of over $1.5m.

“The conduct alleged in this superseding indictment reveals a methodical and relentless effort by foreign interests to obtain and exploit sensitive and valuable U.S. technology through the use of individuals operating within the United States,” said FBI special agent in charge, David Johnson, in a statement. 

“Complex foreign-government sponsored schemes, such as the activity identified here, inflict irreversible damage to the economy of the United States and undercut our national security. The FBI is committed to rooting out industrial espionage that puts U.S. companies at a disadvantage in the global market.”

The US is becoming increasingly exasperated by the lengths to which it sees China going to steal trade secrets and IP in order to benefit the PRC economically.

That’s part of the reason why it took the unprecedented step last year of indicting five PLA officers “for infiltrating US commercial targets by cyber means” – even though it had little chance of ever getting its hands on them.

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