FBI Director Christopher Wray, testifying before the Senate Committee on Intelligence on the “Worldwide Threats” January 29, responded to a query about China’s covert and overt actions which serve to undermine the economy of the United States.

Wray noted that the American people are finally “waking up to understand” that the lines between the Chinese government and the Communist Party “are blurred if not erased.” He continued by highlighting how the lines between the Chinese government and private companies, are also blurred to non-existent. Wray noted how the “line between unlawful behavior and fair competition, and lying and hacking, and cheating and stealing” have all but disappeared.

Wray concluded by highlighting the level of awareness which Director of National Intelligence Coats described as the “waking up” of American companies and universities. Wray noted the level of consensus among his colleagues that the threat posed by China is greater than at any time during his career.

China and the “Stop Higher Education Espionage and Theft Act”

Following the testimony of Wray and other members of the intelligence community we heard Senator Ted Cruz (R-TX) announce he was reintroducing his “Stop Higher Education Espionage and Theft Act” which had languished in the Judicial Committee in 2018. The Senator’s action was prompted by warnings from both the FBI and the intelligence community that China has been eating the lunch of the United States through intellectual property theft and penetration of the U.S. public and private sector.

The bill, as written in 2018, would address “foreign threats to higher education in the United States.” The bill also gives the Director of the FBI the ability to designate a “foreign actor as a foreign intelligence threat to higher education.” The Director would may so designate “if the Director finds that the foreign actor has committed, attempted to commit, or conspired to commit, in connection with an institution, one or more of the following:”

  • Espionage, in violation of sections 791 through 799 of title 18.
  • Kidnapping, in violation of section 1201 of title 18.
  • Fraud or misuse of visas, permits, or other documents, in violation of section 1546 of title 18.
  • Aggravated identity theft, in violation of section 1028A of title 18.
  • Fraud or related activity in connection with access devices, in violation of section 1029 of title
  • Fraud or related activity in connection with computers, in violation of section 1030 of title 18.
  • Economic espionage, in violation of section 1831 of title 18.
  • Theft of trade secrets, in violation of section 1832 of title 18.
  • Terrorism, in violation of sections 2331 through 2339D of title 18.
  • Interception or disclosure of wire, oral, or electronic communications, in violation of section 2511 of title 18.

The act goes on to amend the Higher Education Act of 1965, with a requirement for any institution receiving a gift or contract valued at more than $250,000 within a calendar year shall file a disclosure report, which is lowered to $50,000 for those entities designated as a “foreign intelligence threat to higher education.”

China Uses International Students as Inroads for Espionage

According to data provided by Immigration Policy Institute in May 2018 based on the 2016-17 academic year, shows that the United States hosts approximately 1.1 Million of the 4.6 Million international students enrolled worldwide, or approximately 24%. Of these, 33% of all international students were Chinese, with these 351,000 students spread across the United States, with engineering, business management, math, and computer science as the top fields of study.

China, recognizing the value of the U.S. education and entrepreneurial opportunities in the U.S., has developed the “Thousand Talents” program, which has been accused by the National Intelligence Council as being involved in the illicit transfer of U.S. intellectual property and know-how to China.

The Confucius Institute provides funding to U.S. universities and institutes. The level of funding provided by the institute would fall within Senator Cruz’s bill’s requirement to file a disclosure report. That said, Senator Cruz inserted verbiage into the National Defense Authorization Act that prohibits funding to those entities which receive Confucius Institute funding, following the declaration by Chinese politburo member, Li Changchum on how the institute enables the projection of soft power and “teaching Chinese language, everything looks reasonable and logical.”

Against an authoritarian state, what student could say no?

One should remember, though there are more than 351,000 Chinese citizens currently enrolled in U.S. higher education institutions, most of them have no current interaction with Chinese intelligence, nor are they malevolent at heart. But when the Chinese government comes calling, few have the wherewithal to say, “no.”

That said, breaking trust happens for a variety of reasons, to include greed or being leveraged by China’s Ministry of State Security or other governmental entities. The former was aptly demonstrated when technology valued at over $1 billion was purloined by U.S. educated Hongjin Tan who was arrested on his way to China. The latter was demonstrated with the arrest of U.S. educated Ji Chaoqun who had come to the U.S. for his education, then was hired by the U.S. aerospace industry. What makes Ji’s case so much more alarming than others was the Chinese citizen’s successful infiltration into the U.S. Armed Forces via the MANVI (Military Accessions Vital to the National Interest) program. Ji’s handlers were from the MSS, one of whom was indicted, arrested and extradited to the U.S.

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Christopher Burgess (@burgessct) is an author and speaker on the topic of security strategy. Christopher, served 30+ years within the Central Intelligence Agency. He lived and worked in South Asia, Southeast Asia, the Middle East, Central Europe, and Latin America. Upon his retirement, the CIA awarded him the Career Distinguished Intelligence Medal, the highest level of career recognition. Christopher co-authored the book, “Secrets Stolen, Fortunes Lost, Preventing Intellectual Property Theft and Economic Espionage in the 21st Century” (Syngress, March 2008).