U.S. DOJ: Chinese Spy Targeted GE, Other Aviation Firms

 - October 11, 2018, 12:00 PM

The U.S. Justice Department has arrested and indicted an alleged Chinese spy for attempting to steal trade secrets from GE Aviation and at least two other U.S. aviation companies in activities dating to 2013. “This indictment alleges that a Chinese intelligence officer sought to steal trade secrets and other sensitive information from an American company that leads the way in aerospace,” said Assistant Attorney General for National Security John Demers. “This case is not an isolated incident. It is part of an overall economic policy of developing China at American expense.”

Yanjun Xu, aka Qu Hui and Zhang Hui, an operative for China’s Ministry of State Security (MSS), faces charges of theft of trade secrets, conspiracy, and attempting to commit economic espionage. If convicted on all counts, he faces up to 25 years in federal prison. The indictment charges Xu with concealing his true identity in the course of recruiting targeted engineers at U.S. aviation companies, initially with all-expense-paid “academic” seminars to the Nanjing University of Aeronautics and Astronomics (NUAA), an institution operated by the state Ministry of Industry and Information Technology with close ties to the Commercial Aircraft Corp. of China (Comac) and Aviation Industries of China (AVIC).

Xu often approached targets under the guise of working for the “Jiangsu Science and Technology Association.” Through these associations, Xu then allegedly attempted to more overtly obtain specific technical information from targeted engineers, including paying for trade secrets, and was attempting to do so in Belgium when he was arrested on April 1. He was subsequently indicted and extradited to the U.S. 

Justice Department documents indicated that Xu was attempting to obtain information related to GE’s proprietary aircraft engine composite fan blades and blade encasement structures. However, GE was not the only company Xu was allegedly targeting, according to Justice, which notes that at least two other unnamed companies were targeted by Xu and his compatriots for analytical tools, design manuals relating to structural analysis, software, electric landing gear and braking systems, deicing, flight controls, and military aerial refueling.

“Innovation in aviation has been a hallmark of life and industry in the United States since the Wright brothers first designed gliders in Dayton more than a century ago,” said Benjamin Glassman, U.S. Attorney for the Southern District of Ohio. “U.S. aerospace companies invest decades of time and billions of dollars in research.  This is the American way. In contrast, according to the indictment, a Chinese intelligence officer tried to acquire that same, hard-earned innovation through theft. This case shows that federal law enforcement authorities can not only detect and disrupt such espionage, but can also catch its perpetrators. The defendant will now face trial in federal court in Cincinnati.”