Operation Fox Hunt: Man Charged With Transnational Repression Campaign While Acting As An Illegal Agent Of The Chinese Government In The United States

 The U.S. Justice department released the below information:

A Chinese national is charged in a criminal complaint, which was unsealed today in the Southern District of New York, with conspiring to act in the United States as an illegal agent of the People’s Republic of China (PRC).

According to court documents, Sun Hoi Ying, aka Sun Haiying, 45, of the PRC, from at least February 2017 through February 2022, acted in the United States as an agent of the PRC government, without notifying the U.S. Attorney General as required by law.

“This case demonstrates, once again, the PRC’s disdain for the rule of law and its efforts to coerce and intimidate those it targets on our shores as part of its Operation Fox Hunt,” said Assistant Attorney General for National Security Matthew G. Olsen. “The defendant allegedly traveled to the United States and enlisted others, including a sworn law enforcement officer, to spy on and blackmail his victims. Such conduct is both criminal and reprehensible.”

“The PRC government launched a campaign dubbed ‘Operation Fox Hunt,’ a global plot to repress dissent and to forcibly repatriate so-called ‘fugitives’ – including citizens living legally in the United States – through the use of unsanctioned, unilateral and illegal practices,” said U.S. Attorney Damian Williams for the Southern District of New York. “We allege Mr. Sun, as part of that campaign, attempted to threaten and coerce a victim into bending to the PRC’s will, even using a co-conspirator who is a member of U.S. law enforcement to reinforce that the victim had no choice but to comply with the PRC government’s demands. Today’s charges reflect this office’s continued commitment, working hand in hand with our partners at the FBI, to combat transnational repression and bringing to justice those who perpetrate it.”

“The Chinese government takes advantage of our freedoms — freedoms they deny their own citizens — to advance their authoritarian regime, and calls uncomfortable truths about their behavior rumors and lies,” said Assistant Director Alan E. Kohler Jr. of the FBI’s Counterintelligence Division. “There’s nothing false about seeing example after example of the Chinese government’s underhanded and illegal behavior here in the United States. I urge anyone to contact the FBI if you feel you’re a victim of the Chinese government’s illegal Fox Hunt activities.”

“As alleged, Sun Hoi Ying, acting at the direction of the PRC government, engaged in a range of activities designed to pressure individuals in the United States to return to the PRC to face charges brought by the Chinese government,” said Assistant Director in Charge Michael J. Driscoll of the FBI’s New York Field Office. “Our commitment to protecting the freedoms enjoyed by all United States residents is steadfast. Today's action is the latest example of our unwavering determination to combat transnational repression in all its forms.”

According to court documents, the FBI has been involved in an investigation of individuals who, working at the direction of the PRC government, have engaged in an international campaign, known alternatively as “Operation Fox Hunt” and “Operation Skynet,” to pressure individuals located in the United States and elsewhere to return to the PRC to face charges or to otherwise reach financial settlements with the PRC government.

As alleged, from approximately October 2016 through May 2017, Sun conducted operations in the United States on behalf of the PRC government to pressure, threaten and collect personal information regarding victims of Operation Fox Hunt. Among other things, as part of his operations and at the direction of the PRC government, Sun hired private investigators in the United States to gather personal information on Operation Fox Hunt targets, labeled as “fugitives” by the PRC government and provided some of that information to the PRC government.

According to the complaint, Sun provided 35 names to a private investigator (P.I.-1) working at a U.S. company (Firm-1) of individuals described as PRC fugitives, including Victim-1, who is a U.S. citizen that previously lived in the PRC, worked at a PRC-owned company, and was subsequently accused by the PRC government of embezzlement. As alleged, P.I.-1 conducted surveillance at Victim-1’s home and provided a report to Firm-1 and Sun. By June 2018, the PRC government had publicly disseminated personal identifying information of Victim-1 – including case details, a photograph and home address – on PRC-based news media websites.

While Sun was collecting information about Victim-1 for the PRC government, Victim-1’s daughter (Victim-2), who is a U.S. citizen and was pregnant at the time, was held against her will in the PRC for approximately eight months. In or about October 2016, Victim-2, her spouse and her minor child attempted to leave the PRC to return to the United States. However, Victim-2 was told by PRC customs officials and a PRC prosecutor (Prosecutor-1) that she could not leave and was subject to an “exit ban.” While Victim-2’s spouse and minor child were able to return to the United States, Victim-2 was told that, since Victim-1 had committed a crime, the “exit ban” on Victim-2 was a consequence of Victim-1’s fugitive status. The PRC prosecutor further told Victim-2: (1) that she would not be permitted to leave the PRC until she helped cause Victim-1 to return to the PRC to resolve Victim-1’s criminal case; (2) that Victim-2 was not to discuss the “exit ban” with the U.S. government; and (3) that the U.S. Embassy was helpless to address Victim-2’s status in the PRC. When Victim-2 explained to Prosecutor-1 that she was pregnant and wished to deliver her baby in the United States, Prosecutor-1 told Victim-2 she would deliver her baby in the PRC if the conditions were not yet met for the “exit ban” to be lifted.

According to the complaint, on or about Dec. 1, 2019, Sun also sought out, located and met with an Operation Fox Hunt target (Victim-3), in New York City, in coordination with a co-conspirator who is a local U.S. law enforcement officer. During the meeting, Sun threatened and pressured the victim, including by threatening that the PRC government would take certain adverse and retaliatory actions if the victim did not comply with the demands of the PRC government.

Sun is charged with one count of conspiring to act as an agent of a foreign government without notifying the Attorney General, which carries a maximum sentence of five years in prison, and one count of acting as an agent of a foreign government without notifying the Attorney General, which carries a maximum sentence of 10 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant U.S. Attorneys Matthew J.C. Hellman and Kyle A. Wirshba for the Southern District of New York are prosecuting the case, with valuable assistance provided by Trial Attorney Scott Claffee of the National Security Division’s Counterintelligence and Export Control Section.

The FBI’s New York Field Office is investigating the case.

A complaint is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Chinese National Sentenced For Illegally Exporting Military Electronics Componets

The U.S. Justice Department and the FBI released the below information on September 10th:

BOSTON—Zhen Zhou Wu, a Chinese national, was re-sentenced yesterday to 84 months in prison for conspiring over a 10-year period to illegally export military and sophisticated electronics to the People’s Republic of China (PRC).

Wu was also convicted of illegally exporting sensitive electronic components to the PRC on 12 occasions between 2004 and 2007. Several Chinese military entities were among those to whom the defendant exported the equipment, which is used in military phased array radar, electronic warfare, and missile systems. He was also ordered to pay a $15,000 fine. After serving his sentence, Wu will be subject to deportation to the PRC.

On March 19, 2013, the U.S. Court of Appeals for the First Circuit affirmed Wu’s conviction on 15 of the 17 counts of export violations for which a jury convicted him after a six-week trial in 2010. The First Circuit vacated two counts of conviction that charged Wu with illegally exporting parts designated on the United States Munitions List because it held that the jury instructions given were constitutionally inadequate. However, the First Circuit observed that “from 1996 until 2008, Wu and his co-defendant, Yufeng Wei, shipped tens of millions of dollars worth of sophisticated electronic components from the United States to China, with little regard for whether the parts that they sold were export-controlled.” Further, the First Circuit found that Wu’s company “specifically pursued military customers; and Wu promoted himself as both an exporter of military supplies and an export compliance expert.” Lastly, the First Circuit determined that “Wu and Wei repeatedly attempted to disguise the fact that they were exporting to China and that they lacked the necessary licenses to do so.”

Because two counts of the conviction were vacated, the case was remanded for a re-sentencing hearing. Wei’s re-sentencing hearing has not yet been scheduled.

On May 17, 2010, Wu; his ex-wife, We;, and his company, Chitron Electronics Inc., were convicted of conspiring to unlawfully export to the PRC military electronics from 1997 to 2007 and export restricted electronics components and illegally exporting such parts to the PRC on numerous occasions between 2004 and 2007. The defendants’ illegal enterprise involved the use of Chitron Electronics Inc., a company Wu established in Waltham, Massachusetts, as a front company for its parent company, Chitron Electronics Limited, headquartered in Shenzhen, PRC. Wu used Chitron-US to procure export restricted equipment from U.S. suppliers and then export the goods to from Waltham to China through Hong Kong without the suppliers’ knowledge. The exported equipment is used in electronic warfare, military radar, fire control, military guidance and control equipment, missile systems, and satellite communications. Many of Chitron’s customers were Chinese military research institutes and military entities respon

The Department of Defense’s Defense Technology Security Administration concluded in a report filed with the court that the defendants’ activities in this case seriously threatened “U.S. national and regional security interests.” According to the Department of Defense, the parts the defendants were convicted of illegally exporting are “vital for Chinese military electronic warfare, military radar, fire control, military guidance and control equipment, and satellite communications.” The report further concluded that the illegally exported parts are “precisely the [types of] items...that the People’s Liberation Army actively seeks to acquire.”

United States Attorney Carmen M. Ortiz; Acting Assistant Attorney General John P. Carlin of the Justice Department’s National Security Division; John J. McKenna, Special Agent in Charge of the U.S. Department of Commerce, Office of Export Enforcement, Boston Field Office; Bruce Foucart, Special Agent in Charge of Homeland Security Investigations in Boston; Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Office; and Leigh-Alistair Barzey, Resident Agent in Charge of Defense Criminal Investigative Service in Boston made the announcement. The case is being prosecuted by Assistant U.S. Attorneys B. Stephanie Siegmann and John A. Capin of Ortiz’s Anti-Terrorism and National Security Unit. 

Hawaiian Spy: Former Northrop Engineer Convicted of Passing Classified Information to the Communist Chinese

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A federal jury in Hawaii on Monday convicted Noshir S. Gowadia (seen in the above photo) of crimes related to passing classified information to the Communist Chinese.
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Below is the Justice Department's release:

Hawaii Man Convicted of Providing Defense Information and Services to People’s Republic of China/Former B-2 Bomber Engineer Helped PRC Design a Stealthy Cruise Missile
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WASHINGTON – A federal jury in U.S. District Court for the District of Hawaii today found Noshir S. Gowadia, age 66, of Maui, guilty of five criminal offenses relating to his design for the People’s Republic of China (PRC) of a low signature cruise missile exhaust system capable of rendering a PRC cruise missile resistant to detection by infrared missiles.
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The jury also convicted Gowadia of illegally communicating classified information on three other occasions and unlawfully exporting technical information on those three occasions, illegally retaining defense information, and filing false tax returns for the years 2001 and 2002. The jury acquitted Gowadia of three other offenses alleging illegal communication of information to the PRC.
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The verdict was announced by David Kris, Assistant Attorney General for National Security, and Florence T. Nakakuni, U.S. Attorney for the District of Hawaii. The verdict followed six days of deliberation and a 40-day trial in the District of Hawaii.
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“Mr. Gowadia provided some of our country’s most sensitive weapons-related designs to the Chinese government for money. Today, he is being held accountable for his actions. This prosecution should serve as a warning to others who would compromise our nation’s military secrets for profit. I commend the many prosecutors, analysts, and agents - including those from the FBI and the Air Force - who were responsible for this investigation and prosecution,” said Assistant Attorney General Kris.
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“The United States entrusts people with important and sensitive information critical to our nation’s defense. Today’s verdict demonstrates that there is a serious consequence to betraying that trust,” said U.S. Attorney Nakakuni.
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“The FBI will continue to pursue anyone who treats America's national security as a commodity to be sold for personal enrichment,” said Charlene Thornton, Special Agent in Charge of the Honolulu Field Office of the FBI.
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“This case is a superb example of interagency cooperation with one single goal in mind: to protect Americans from harm. The successful prosecution of Mr. Gowadia for espionage and other crimes highlights the many contributions of AFOSI personnel and our partner organizations worldwide,” said Colonel Keith Givens, Vice Commander, Headquarters, U.S. Air Force Office of Special Investigations.
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Gowadia was first arrested in October 2005 on a criminal complaint alleging that he willfully communicated national defense information to a person not entitled to receive it. He was charged with additional violations in a 2005 indictment, a 2006 superseding indictment and a 2007 second superseding indictment.
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According to information produced during the trial, Gowadia was an engineer with Northrop Grumman Corporation from approximately 1968 to 1986, during which time he contributed to the development of the unique propulsion system and low observable capabilities of the B-2 Spirit bomber (seen in the below photo), sometimes referred to as the “Stealth” bomber.
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Gowadia also continued to work on classified matters as a contractor with the U.S. government until 1997, when his security clearance was terminated.
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Evidence at the trial revealed that from July 2003 to June 2005, Gowadia took six trips to the PRC to provide defense services in the form of design, test support and test data analysis of technologies for the purpose of assisting the PRC with its cruise missile system by developing a stealthy exhaust nozzle and was paid at least $110,000 by the PRC.
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The jury convicted Gowadia of two specific transmissions of classified information: a PowerPoint presentation concerning the exhaust nozzle of a PRC cruise missile project and an evaluation of the effectiveness of a redesigned nozzle, and a computer file providing his signature prediction of a PRC cruise missile outfitted with his modified exhaust nozzle and associated predictions in relation to a U.S. air-to-air missile.
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The prosecution also produced evidence which documented Gowadia’s use of three foreign entities he controlled, including a Liechtenstein charity purportedly for the benefit of children, to disguise the income he received from foreign countries.
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In addition to demonstrating that Gowadia under-reported his income and falsely denied having control over foreign bank accounts for the two tax years involved in his convictions, the evidence at trial revealed that Gowadia had not paid any income tax since from at least 1997 until 2005 when he was arrested.
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Chief U.S. States District Judge Susan Oki Mollway set sentencing for Nov. 22, 2010. At that time, Gowadia faces the following maximum terms of imprisonment.
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Life imprisonment for each of two counts of willfully communicating classified national defense information to the PRC with the intent that it be used to the advantage of the PRC or to the injury of the United States.
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Ten years imprisonment for each of three counts of willfully communicating classified national defense information to persons not entitled to receive it in the PRC and elsewhere, and one count of illegally retaining defense systems information at his Maui residence.
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Ten years imprisonment for each of four counts of exporting technical data related to a defense article without an export license (in violation of the Arms Export Control Act).
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Five years imprisonment for one count of conspiracy to violate the Arms Export Control Act.
Ten years imprisonment for one money laundering charge based on proceeds from the Arms Export Control Act violations.
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Three years imprisonment for each of two counts of filing false tax returns for the years 2001 and 2002.
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This case was investigated by the FBI, the U.S. Air Force Office of Special Investigations, the Internal Revenue Service’s Criminal Investigation Division, U.S. Customs and Border Protection, U.S. Immigration and Customs Enforcement and the State Department’s Directorate of Defense Trade Controls.
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The case was prosecuted by Assistant U.S. Attorney Kenneth M. Sorenson of the U.S. Attorney’s Office for the District of Hawaii and Senior Trial Attorney Robert E. Wallace Jr., of the Counterespionage Section of the Justice Department’s National Security Division.