U.S. Detains Alleged Chinese Spy It Says Tried to Steal GE Trade Secrets

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An alleged Chinese intelligence operative arrested in Belgium has been brought to the U.S. and charged with conspiring to steal trade secrets from GE Aviation and other companies, marking a rare break for the U.S. in its increasingly aggressive effort to target Chinese industrial spying.

Prosecutors have previously charged Chinese government officials with economic espionage and hacking-related offenses pointing to state-directed efforts to steal U.S. technology, but have never publicly identified anyone in custody as a Chinese intelligence officer. The arrested man, Yanjun Xu, made an initial appearance in federal court in Ohio on Wednesday.

“This case is not an isolated incident. It is part of an overall economic policy of developing China at American expense,” John Demers, the head of the Justice Department’s national-security division, said in announcing the charges.

Mr. Xu was identified in court papers as a deputy division director in a department of China’s Ministry of State Security, the country’s intelligence agency. Prosecutors allege that he worked from 2013 through this year with others associated with the ministry and several Chinese universities to obtain sensitive and proprietary information from U.S. U.S. aviation and aerospace companies. They say he worked in part by recruiting U.S. employees to travel to China for what was characterized as an exchange of ideas.

The case emerges amid growing tensions between the U.S. and China on several fronts. On Monday, the top U.S. and Chinese diplomats, Secretary of State Mike Pompeo and Foreign Minister Wang Yi, exchanged testy words over trade and other issues.

Trade talks between the two countries have made little progress, as have military discussions. And Vice President Mike Pence last week accused China of working against U.S. interests in various ways, including by interfering in American elections.

Also on Wednesday the U.S. Treasury Department issued new rules requiring all foreign investors in certain deals involving critical U.S. technology to submit to national-security reviews, a move designed to address U.S. concerns about a spate of Chinese technology deals in Silicon Valley.

A lawyer for Mr. Xu couldn’t be identified. The Chinese Embassy didn’t immediately respond to a request for comment.

A General Electric representative said the Chinese official targeted a former GE Aviation employee and that the impact to the company was minimal. “For months, GE Aviation has cooperated with the FBI investigation,” the company said in a statement, adding that “no sensitive information relating to military programs was targeted or obtained.”

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