SPY SCANDAL: Chinese engineer admits stealing critical defense secrets from U.S.

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A Chinese man who holds dual citizenship from both the United States and China and worked as an engineer for a Los Angeles research and development firm has been busted for stealing critical missile-tracking technology for the Chinese government.

A Department of Justice press release reads: A Santa Clara County man and former engineer at a Southern California company pleaded guilty today to stealing trade secret technologies developed for use by the U.S. government to detect nuclear missile launches, track ballistic and hypersonic missiles, and to allow U.S. fighter planes to detect and evade heat-seeking missiles.

Chenguang Gong, 59, of San Jose, pleaded guilty to one count of theft of trade secrets. He remains free on $1.75 million bond.

According to his plea agreement, Gong – a dual citizen of the United States and China – transferred more than 3,600 files from a Los Angeles-area research and development company where he worked – identified in court documents as the victim company – to personal storage devices during his brief tenure with the company last year.

The files Gong transferred include blueprints for sophisticated infrared sensors designed for use in space-based systems to detect nuclear missile launches and track ballistic and hypersonic missiles, as well as blueprints for sensors designed to enable U.S. military aircraft to detect incoming heat-seeking missiles and take countermeasures, including by jamming the missiles’ infrared tracking ability. Some of these files were later found on storage devices seized from Gong’s temporary residence in Thousand Oaks.

In January 2023, the victim company hired Gong as an application-specific integrated circuit design manager responsible for the design, development and verification of its infrared sensors. Beginning on approximately March 30, 2023, and continuing until his termination on April 26, 2023, Gong transferred thousands of files from his work laptop to three personal storage devices, including more than 1,800 files after he had accepted a job at one of the victim company’s main competitors.

Many of the files Gong transferred contained proprietary and trade secret information related to the development and design of a readout integrated circuit that allows space-based systems to detect missile launches and track ballistic and hypersonic missiles and a readout integrated circuit that allows aircraft to track incoming threats in low visibility environments.

Gong also transferred files containing trade secrets relating to the development of “next generation” sensors capable of detecting low observable targets while demonstrating increased survivability in space, as well as the blueprints for the mechanical assemblies used to house and cryogenically cool the victim company’s sensors. This information was among the victim company’s most important trade secrets that are worth hundreds of millions of dollars. Many of the files had been marked “[VICTIM COMPANY] PROPRIETARY,” “FOR OFFICIAL USE ONLY,” “PROPRIETARY INFORMATION,” and “EXPORT CONTROLLED.”

Law enforcement also discovered that, between approximately 2014 and 2022, while employed at several major technology companies in the United States, Gong submitted numerous applications to ‘Talent Programs’ administered by the People’s Republic of China (PRC). The PRC government has established these talent programs as a means to identify individuals who have expert skills, abilities, and knowledge of advanced sciences and technologies in order to access and utilize those skills and knowledge in transforming the PRC’s economy, including its military capabilities.

In 2014, while employed at a U.S. information technology company headquartered in Dallas, Gong sent a business proposal to a contact at a high-tech research institute in China focused on both military and civilian products. In his proposal, translated from Chinese, Gong described a plan to produce high-performance analog-to-digital converters like those produced by his employer. In another Talent Program application from September 2020, Gong proposed to develop “low light/night vision” image sensors for use in military night vision goggles and civilian applications. Gong’s proposal included a video presentation that contained the model number of a sensor developed by an international defense, aerospace, and security company where Gong worked from 2015 to 2019.

Gong travelled to China several times to seek Talent Program funding in order to develop sophisticated analog-to-digital converters. In his Talent Program applications, Gong underscored that the high-performance analog-to-digital converters he proposed to develop in China had military applications, explaining that they “directly determine the accuracy and range of radar systems” and that “[m]issile navigation systems also often use radar front-end systems.” In a 2019 email, translated from Chinese, Gong remarked that he “took a risk” by traveling to China to participate in the Talent Programs “because [he] worked for…an American military industry company” and thought he could “do something” to contribute to China’s “high-end military integrated circuits.”

According to his plea agreement, the intended economic loss from Gong’s criminal conduct exceeds $3.5 million.

U.S. District Judge John F. Walter scheduled sentencing for Sept. 29, at which time Gong faces a statutory maximum penalty of 10 years in prison.

Deputy FBI Director Dan Bongino then posted the following statement on Wednesday:

Another update for you on our efforts to defend the homeland and protect the American people from foreign intelligence agents.

Yesterday, Chenguang Gong, a Chinese national, residing in California, pled guilty to THEFT OF TRADE SECRETS. He downloaded THOUSANDS of files related to technologies developed to detect, track, and evade nuclear, ballistic, hypersonic, and heat-seeking missiles CRITICAL for our US military to protect the homeland. These files were worth HUNDREDS of MILLIONS of dollars, and COUNTLESS research and development man-hours according to the victim companies.

China’s government established “Talent Programs” with the purpose to identify and recruit science and technology experts to give China an advantage by transforming their economy, including its military capabilities. These programs are STILL a problem. Our investigation revealed Gong submitted numerous applications and traveled to China on several occasions to secure Talent Program funding to develop sophisticated technology to support China’s national defense, military, and aerospace efforts.

We encourage our partners in the private sector to PROTECT your trade secrets from Chinese Communist Party theft. Reach out to your local FBI field office if you have any national security concerns, and together with our FBI Private Sector Coordinators, we will protect the homeland from threats both domestic and abroad.

I’d like to highlight the great work done by FBI Los Angeles and San Francisco, and thank our partners in this case, State Department’s Diplomatic Security Service, Homeland Security Investigations and our private sector partners.

God bless America, and all those who defend Her.

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