and China "are at war, economically." She argued that Xu should not be punished because China, itself, can't be. Xu, who has a wife and son in China, has been jailed for more than four years, ever since his arrest. He was seeking information on composite materials used in GE's fan blades and fan blade encasements – materials that are more durable, weigh less and cost less.Īt the time of Xu's arrest, GE had spent more than $5 billion since 2011 developing the ceramic composites. Officials have said that the technology Xu was trying to steal from GE Aviation was civilian, not military. "When he was extradited from Belgium to stand trial" in the U.S., Cors said, "he was then, and remains now, a dedicated citizen of China who …. Xu's attorney, Jeanne Cors, said in documents filed in advance of the sentencing that Xu was acting at the direction of his country. Prosecutors said Xu worked with others in the Ministry of State Security to hack or copy computers in hotel rooms while the experts were taken to dinner by ministry officials. Xu and others with Chinese intelligence paid the experts stipends on top of covering travel costs. He identified experts who worked for the companies and recruited them to travel to China, often initially under the guise that they were traveling to give a presentation at a university. Prosecutors said Xu used multiple aliases to target specific companies in the U.S. currency wrapped in brown envelopes, prosecutors said. When FBI agents and Belgian authorities arrested Xu and the other accused spy, the two had multiple cellphones, photos of the GE Aviation engineer and his family and thousands of dollars in U.S. "He leveraged human intelligence sources, as well as cyber techniques." Attorney Timothy Mangan said in documents filed in advance of the sentencing. Xu "used aliases, front companies and false documents," Assistant U.S. No other company in the world has been able to duplicate GE Aviation's composite aircraft engine fan, prosecutors said. Examples from Classical Literature Such espionage pointed to something that was not quite open and aboveboard. China wanted to build its own jet engine modeled after GE Aviation’s, according to prosecutors. MORE | 3 Kentucky, Indiana residents accused in conspiracy to sell U.S.The espionage was part of a Chinese government policy to steal trade secrets from aviation companies, prosecutors said, and develop technology at American expense. This Office will continue to seek to protect American innovation and hold accountable those who attempt to steal our nation’s science and technology, regardless of status or affiliation, whether civilian, military, or spy.” “Xu conspired to commit economic espionage on behalf of the Chinese government, and he tried to steal the valuable innovation and trade secrets of industry-leading American aviation technology companies. “The jury, by its guilty verdict here today, held Xu accountable for his classic spy techniques,” said Patel. Patel announced Xu’s conviction Friday evening on two counts of conspiring and attempting to commit economic espionage, two counts of attempted theft of trade secrets and one count of conspiracy to commit trade secret theft. The DOJ Criminal Division’s Office of International Affairs successfully extradited Xu to the US with assistance from the government of Belgium as well as the Belgian Federal Police. Kohler said the case should dispel doubts about the “real goals” of the PRC and serve as “a wake-up call” that “they are stealing American technology to benefit their economy and military.” “Instead, and with the support of our allies, we will continue to investigate, prosecute, and hold accountable those who try to take the fruits of American ingenuity illegally.”įBI Counterintelligence Assistant Director Alan Kohler called Xu’s actions “state-sponsored economic espionage by the PRC designed to steal American technology and put Americans out of work.” “But this conviction also serves notice that the United States will not sit by as China, or any other nation-state, attempts to steal instead of researching and developing key technology,” Olsen said. The case underscores the threat of Cold War-Esque strategies by the People’s Republic of China to modernize its industries through theft of trade secrets, according to DOJ National Security Division Assistant Attorney General Matthew Olsen.
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