Chinese Peril

China's military is using espionage to steal secrets
By Ryan Browne

China is using student spies to steal secrets

China is continuing to modernize its armed forces in order to transform its military into a major global power and using espionage to steal cutting edge technology for military purposes, according to a newly released Pentagon report on China's military.
"China uses a variety of methods to acquire foreign military and dual-use technologies, including targeted foreign direct investment, cyber theft, and exploitation of private Chinese nationals' access to these technologies, as well as harnessing its intelligence services, computer intrusions, and other illicit approaches," the Congressionally mandated Department of Defense report said.
"China obtains foreign technology through imports, foreign direct investment, the establishment of foreign research and development (R&D) centers, joint ventures, research and academic partnerships, talent recruitment, and industrial and cyberespionage," the report added.
The Chairman of the Joint Chiefs of Staff, Gen. Joseph Dunford, recently warned Congress that US companies that did business in China were often indirectly benefiting the Chinese military, citing Google as an example.
The report said that China had used these techniques to acquire sensitive, dual-use, or military-grade equipment from the United States, including aviation and antisubmarine warfare technologies.
Beijing is also exploiting its citizens and foreigners of Chinese descent living abroad to further the aims of the Chinese Communist Party the report says, saying that a "cornerstone of China's strategy includes appealing to overseas Chinese citizens or ethnic Chinese citizens of other countries to advance CCP objectives through soft power or, sometimes, coercion and blackmail."

Beijing developing advanced weaponry
Some of the more advanced technology China is developing includes hypersonic missiles, weapons that travel at least five-times the speed of sound.
"China has tested hypersonic glide vehicles. In August 2018, China successfully tested the Xingkong-2 (Starry Sky-2), which it publicly described as a hypersonic waverider vehicle," the report says, referencing a missile that can travel close to the water to avoid detection and missile defense.
The report also details the growth in China's defense budget and its military capabilities, saying "China's defense budget has nearly doubled during the past 10 years."
Much of that money is being spent on beefing up the Chinese navy, with the report saying that China commands "the region's largest navy, with more than 300 surface combatants, submarines, amphibious ships, patrol craft, and specialized types."

Top US general says Google is benefiting the Chinese military

The report calls the Chinese navy an "increasingly modern and flexible force," saying that the "modernization of China's submarine force remains a high priority."
It says China's total submarine force "will likely grow to between 65 and 70 submarines by 2020" and that China will field a new guided-missile nuclear attack submarine "by the mid-2020s" providing Beijing with "a more clandestine land-attack option."
China's first domestically built aircraft carrier will also "likely join the fleet by the end of 2019" and its second domestically built carrier is projected to be operational by 2022.
Beijing is also rapidly building up its Coast Guard to help enforce its claims over disputed islands in the South China Sea, according to the report.
Since 2010 the Chinese Coast Guard has doubled its fleet of large patrol ships and now commands some 130 large vessels, "making it by far the largest coast guard force in the world and increasing its capacity to conduct simultaneous, extended offshore operations in multiple disputed areas."
The report also says China uses its People's Armed Forces Maritime Militia, a reserve force of civilians available for mobilization, "to achieve China's political goals" in the South China Sea without fighting.
China has attempted to increase its control over the features and waterways of the South China Sea where some 78 percent of its oil imports and 16 percent of natural gas imports sails.
"In the South China Sea, China has continued militarization. Anti-ship cruise missiles and long-range surface-to-air missiles have been deployed to Spratly Islands outposts, and China's strategic bombers have conducted take-off and landing drills on Woody Island in the Paracel Islands," the report said, adding that the missiles deployed to the Spratly Islands in 2018 are the "most capable land-based weapons systems deployed by China in the disputed South China Sea."
"China states that international military presence within the South China Sea is a challenge to its sovereignty. China has continued to escalate coercive tactics to enforce its claims within the South China Sea," it added.

Six former top US generals issue grave warning to ban Huawei

New Zealand's membership of the Five Eyes group should be reconsidered given its close relationship with Beijing.

By Ben Westcott

Six retired US military leaders have issued a statement calling on America's allies to ban Chinese technology giants from outfitting their 5G networks, citing "grave concerns" over security.
The statement, released Wednesday, was signed by six highly-respected, retired US military officials, including former Director of National Intelligence James Clapper and former NATO Supreme Allied Commander in Europe James Stavridis.
"As military leaders who have commanded US and allied troops around the world, we have grave concerns about a future where a Chinese-developed 5G network is widely adopted among our allies and partners," the statement began.
The joint statement comes as New Zealand Prime Minister Jacinda Ardern refuted suggestions that Chinese technology company Huawei had been banned in her country.
Huawei is one of China's largest technology companies and in recent years has become one of the most widely-used providers of super-fast 5G network technology globally.

"I've seen some suggestion that Huawei products have been banned in New Zealand, that's simply not the case," said Ardern, during an interview broadcast on Chinese state media CGTN.
"We already have Huawei products in New Zealand and Huawei already operates in New Zealand," she added.
The Trump administration has been pushing hard for diplomatic partners to remove Huawei technology from their networks, claiming the company is too close to the Chinese government.
New Zealand is a longtime ally of the United States and a member of their exclusive Five Eyes intelligence sharing community, along with Australia, the United Kingdom and Canada.
A former US government analyst Peter Mattis said in 2018 that New Zealand's membership of the group should be reconsidered given its close relationship with Beijing.
In their statement, Wednesday, the US military leaders highlighted three areas of concern over a growing presence of Chinese technology in international networks -- espionage, risks to future military operations and undermining democracy and human rights.
"The Chinese Cyber Security Law and other national strategies like 'military-civil fusion' mean that nothing Chinese firms do can be independent of the state. Firms must support the law enforcement, intelligence, and national security interests of the Chinese Communist Party," the statement said.
They claimed calls for the US intelligence community to produce evidence, or a "smoking gun," to justify calls for a ban "misunderstand the challenge at hand."

"The onus should instead be on Beijing to explain why it is prudent for countries to rely on Chinese telecommunications technology when Beijing's current practices threaten the integrity of personal data, government secrets, military operations, and liberal governance," the statement said.
New Zealand's Ardern wrapped up a two-day visit to China at the beginning of this week, a visit which was intended to shore up somewhat-rocky relations between the two nominally friendly nations.
It was a decision by New Zealand's security services to recommend against the use of Huawei technology which led to the reported rift.
But when asked during her interview with Chinese state media if US objections to Huawei would influence New Zealand policy, Ardern said no.
"New Zealand has not been pressured in that regard but even, regardless, it would make no difference. We determine our policy and our position on these matters," she said.

Huawei's Chinese Spy Raises Red Flags for Poland and the U.S.

Warsaw and Washington are probing deep ties Beijing has established in the strategically important country on NATO’s eastern frontier

By Bojan Pancevski and Matthew Dalton

An undated photo of Huawei executive Wang Weijing, Chinese spy arrested in Poland. Huawei Technologies Co. has 50% of the Polish telecommunications infrastructure market. 

WARSAW—Authorities in Poland and the U.S. are probing the deep ties Beijing has forged in this strategically important country on NATO’s eastern frontier in the wake of high-profile arrests of a Chinese executive and a former Polish official.
Wang Weijing, who worked in Poland for Huawei Technologies Co., and Piotr Durbajlo, a former senior Polish counterintelligence official, were detained this month and charged with spying for China. 

Wang was fired by Huawei following his arrest.

Neither Durbajlo nor his lawyer could be reached for comment.

China's spy nest: Huawei’s headquarters in Shenzhen, China. 

Part of the investigation—which officials said Poland is coordinating with the U.S.—involves events at Poland’s elite Military University of Technology, whose graduates often go on to take sensitive security and military jobs. 

Durbajlo has served as an instructor at the university.
Wang had visited the university in conjunction with a contest run by Huawei called “Seeds of the Future,” according to the university. 

In recent years, students there have been among the winners of the contest, which offers all-expenses-paid trips to China, including a week at company headquarters in Shenzhen.
The investigation—which officials said has been going on for at least two years—is forcing Polish officials to consider whether China’s growing presence has left the country vulnerable to security and intelligence breaches. 

Huawei by some estimates has nearly 50% of the Polish telecommunications infrastructure market.
“The Chinese have been very active for years,” said a senior Polish lawmaker who has been briefed on the investigation. 

“To give them so much freedom, so much space to maneuver was too much.”
One fear among both Polish and U.S. officials is that China might have accessed allied intelligence shared with Poland and passed it on to Moscow.

Poland’s Pressure on Huawei: Poland is urging its NATO allies to coordinate their response to cybersecurity challenges raised by the Chinese company. This jeopardizes a key market for Huawei. 

Senior U.S. officials say they are exploring how to roll back the deep involvement of Chinese companies such as Huawei in the economies and infrastructure of Poland and other European countries.
“We are figuring out how to deal with that,” said a senior U.S. official with detailed knowledge of the region. 

The broader telecommunications infrastructure is at risk “now that some countries have been infected.”
Huawei operates as a Trojan horse for the Chinese government. 

Chinese laws dictate that authorities can freely access information or data from companies incorporated there.
Poland was once part of the same Communist world as China. 

After the collapse of the Soviet Union, Poland joined major Western institutions, such as the European Union and the North Atlantic Treaty Organization.
The Polish government has sought in recent years to attract Chinese investment. 

Warsaw kept the investigation into Wang and Durbajlo classified partly out of fear of provoking Chinese retaliation, said the Polish lawmaker. 

But the trial, he added, would inevitably draw attention to the case.
“The whole world will be watching this because there have been rumors about the criminal activities of Huawei but never any proof.”

A train arrived in Warsaw from Chengdu, China, in 2016. 

Polish officials are now trying to get a sense of which people who have held sensitive government positions may have ties to China, the lawmaker said.
And Polish counterintelligence is looking into some of the state institutions Durbajlo worked for, officials said.
In addition to serving as a cryptology lecturer at the military academy, Durbajlo has held senior positions at Poland’s Internal Security Service and the agency that oversees classified government communications, as well as Poland’s cybersecurity body, working in different capacities for the government until 2017. 

Since his arrest, he has been suspended from his job at Orange SA, the French telecommunications carrier, which serves about a quarter of Polish mobile phone subscribers.
A former Huawei employee described Wang, who spoke fluent Polish, as quiet and affable. 

Wang attended meetings at the Polish military university to discuss cooperation with Huawei and tout the “Seeds for the Future” contest to officials there, according to university news releases.

“Now trade is booming, but there is no [Chinese] investment,” said Witold Waszczykowski, a former Polish foreign minister. 

The recent arrests come as Poland is becoming disillusioned with China as an economic partner, said Witold Waszczykowski, a former Polish foreign minister and one of the architects of efforts to boost economic ties.
Hoped-for investments, including an airport in Warsaw and high-speed train lines, haven’t materialized, he said. 

“Now trade is booming, but there is no [Chinese] investment,” Mr. Waszczykowski said.
The most sensitive U.S. project in Poland is a missile base due to become operational by 2020 as part of a nuclear shield NATO says will protect against potential attacks by Iran but which Russia has said is really aimed at countering Moscow. 

Any intelligence about the base would be of great value to Beijing, said Fabrice Pothier, former top aide to two NATO chiefs.
“Because of the relationship with the U.S. and membership in the NATO alliance and in the EU, we are an important target,” said Krzysztof Liedel, former director of the National Security Bureau, one of Poland’s security and defense agencies. 

“We are a gate through which to gather information and data on our allies.”

The big thief who cries thief

China Accuses Taiwan of Using Students for Espionage

By Sui-Lee Wee and Chris Horton

Beijing is hostile toward President Tsai Ing-wen of Taiwan, whose party is skeptical of closer ties to China.

BEIJING — China has accused intelligence agencies in Taiwan of targeting mainland students on the island, drawing accusations of hypocrisy from Taipei as it investigates espionage by Beijing.
The accusations against Taiwan were first made on Saturday by the state broadcaster China Central Television, and at least six other news outlets followed with reports on Sunday and Monday. 

They included The Global Times, a nationalist tabloid owned by the Communist Party’s official newspaper.
The reports cited cases from as far back as 2011, and said that in addition to students, a hotel employee and a driver for a travel agency had been targeted to provide information.
The news reports come at a time of increased Chinese pressure on Taiwan, which China’s communist government has never ruled but claims as part of its territory. 

Taiwan is scheduled to hold local elections in November, which will weigh reactions to the first two years of President Tsai Ing-wen’s leadership.
Beijing is hostile toward Ms. Tsai, whose party is skeptical of closer ties with China, and it has stepped up pressure on the island since she took office, increasing its military activities near Taiwanese waters and airspace, and poaching some of Taiwan’s few remaining allies.
In a statement on Sunday, Taiwan’s Mainland Affairs Council, which handles cross-strait policy, blasted China’s accusations as hypocritical.
“Aside from strengthening its internal control requirements,” the statement said, China “has also continually extended espionage activities beyond its borders.”
“Taiwan calls on China to rein itself in from this precipice as quickly as it can,” it added, “otherwise it will produce an even more unfavorable impact on cross-strait relations.”
For seven decades, Beijing has sought to absorb Taiwan, where Chiang Kai-shek’s Nationalist government fled after losing the Chinese civil war. 

It has not renounced the use of force to achieve this goal. 

Few in Taiwan are in favor of unification with China, which would in theory be under a “one country, two systems” arrangement similar to the one in Hong Kong, where the influence of the central government in Beijing is eroding local semiautonomy.
“Due to the presence of ‘Taiwan independence’ forces on the island, the Taiwan authorities have increased the number of spies that they have dispatched to the mainland, and their activities have become more frequent and arrogant,” The Global Times article said. 

“This makes our enemy situation on the hidden front more serious and the anti-espionage task more arduous.”
The article also said the United States had “repeatedly tried to clash with the mainland’s red line on the Taiwan issue, which may further destabilize the Taiwan straits.”
With relations between the United States and Taiwan improving under the Presidents Trump and Tsai administrations, the Chinese state news media has increased its attacks on Taipei, declaring that Beijing would go to war over the island.
Ms. Tsai briefly stopped in Houston and Los Angeles in August, despite vehement opposition from China, and received a warmer reception than previous leaders of Taiwan had.
In a statement on Sunday, An Fengshan, spokesman for China’s Taiwan affairs office, said that Chinese national security organs had started cracking down on "possible" espionage by Taiwan.
China-Taiwan relations had improved under the previous administration in Taipei, and educational exchanges progressively increased. 

Beginning in 2008, students from designated parts of China were allowed to study in Taiwan for up to a year, up from four months. 

A 2010 law then allowed Chinese undergraduates to pursue degrees in Taiwan, after the island provided some safeguards.
The number of nondegree-seeking Chinese students in Taiwan grew to 34,114 in 2015 from 823 in 2007, according to the Ministry of Education in Taipei. 

The number of Chinese studying for degrees rose to 7,813 in 2015 from 928 in 2011, the first year they were allowed to go to Taiwan.
In comparison, the number of students from Taiwan attending universities in mainland China was 10,536 in 2015, China Daily reported, citing Ministry of Education figures.
But China suspended official contact with Taiwan in 2016 over Ms. Tsai’s refusal to recognize the “one-China” principle, and last year Beijing halved the number of students allowed to study in Taiwan.
The Global Times, citing an unidentified national security official, said that students in the fields of politics, economics or national defense were the most frequent targets of Taiwan’s spies, in the hope that they would gain important positions in mainland China with access to confidential files.
The article identified and published the photographs of three people it said were Taiwanese spies, two of whom it claimed worked for Taiwan’s military intelligence bureau. 

It said they had befriended students before asking them to provide sensitive information from the mainland.
One of them initiated a sexual relationship, the article said, while another helped a student find people to interview for his thesis. 

A third entertained a political science student and her friends.
The article did not say if any of the three had been arrested.
In its statement on Sunday, the Mainland Affairs Council questioned the credibility of the Chinese accusations.
“How could average exchange students possess confidential materials and intelligence,” it asked, “and what would an intelligence officer gain from setting a honey trap for them?”
The governments of China and Taiwan have spied on each other regularly since 1949. 

Taiwan is investigating recent allegations of Chinese espionage on its territory, with two high-profile cases involving fringe pro-unification parties.
Three members of the New Party, including its spokesman, Wang Ping-chung, were indicted in June on charges of violating Taiwan’s National Security Act. 

Prosecutors said they had found evidence that the party had received money from China and that the three had engaged in espionage activities.
That case stemmed from the espionage conviction of a mainland Chinese man who had graduated from a university in Taiwan.
In a separate case, last month investigators in Taiwan raided the residence of Chang An-lo, head of the China Unification Promotion Party. 

Chang, a former leader of one of Taiwan’s main organized crime groups, is accused of receiving illegal funds from China for his party, whose members have attacked pro-independence youth here, as well as from practitioners of Falun Gong, a spiritual movement that is banned in China.
Chang said he had made money by doing business in China and denied receiving funds from Beijing.
The People’s Daily said the government would give 500,000 renminbi, or $73,000, to informants providing information on spies.
The Global Times, citing an unidentified national security official, said that China would be lenient with students who pleaded guilty and repented. 

The official urged students to be vigilant and to refuse any “free lunch.”

China’s Targeting of Filipino Chinese for Intelligence, Influence and Drug Trafficking

By Anders Corr, Ph.D.

Davao City Vice Mayor Paolo Duterte (L), son of Philippine President Rodrigo Duterte, and the president’s son-in-law, Manases Carpio (R), take an oath as they attend a senate hearing in Manila on September 7, 2017. Paolo Duterte and Manases Carpio appeared before the inquiry to deny as “baseless” and “hearsay” allegations linking them to large-scale illegal drugs smuggling. 

On June 12, Philippine protesters staged coordinated protests against China in Los Angeles, San Francisco, and Vancouver. 

Protest organizer Ago Pedalizo said, “Duterte’s government pursues the ‘sell, sell, sell’ approach to sovereignty as a trade-off to all kickbacks he’ll get from the ‘build, build, build’ economic push of China.” 

His protest group, Filipino American Human Rights Advocates (FAHRA), charged that “Duterte is beholden to the $15-billion loan with monstrous interest rate and China’s investments in Boracay and Marawi, at the expense of Philippine sovereignty. This is not to mention that China remains to be the premier supplier of illegal drugs to the country through traders that include the son, Paolo Duterte, with his P6 billion shabu [methamphetamine] shipment to Davao.”
Paolo Duterte has denied the allegations. 

Philippine and Chinese government offices did not reply to requests for comment.
But, experts have confirmed that kickbacks and drug shipments come through Filipino Chinese networks. 

Current Philippines President Rodrigo Duterte himself has self-identified as Chinese in the course of affirming his sincerity to an accommodating position on the South China Sea conflict. 

He said this to a correspondent on CCTV, a Chinese state television network.
Asked about Duterte and influential Special Assistant to the President Mr. Bong Go, one expert replied, “Duterte has been given money by the Chinese as early as when he was mayor [of Davao City, Mindanao]. The Chinese will not give it to him directly, but through the Filipino Chinese. Bong Go is a Filipino Chinese.”
Another source with knowledge of elite networks in the Philippines confirmed that Chinese intelligence services focus on Filipinos of Chinese ancestry in their attempts to infiltrate the Philippines, including Mr. Bong Go and other Filipino Chinese in Duterte’s inner circle. 

He added that some Chinese networks in the Philippines specialize in the illegal drug trade and business more generally, and serve a dual intelligence function. 

He said that China currently has “unprecedented access” to Duterte.
Chinese state targeting of overseas Chinese for intelligence, drugs and influence operations is well documented in a growing field of study on Chinese influence operations globally. 

The contemporary literature has been developed by an impressive number of scholars and journalists, including Bethany Allen-Ebrahimian, Anne-Marie Brady, Kerry Brown, Kevin Carrico, J. Michael Cole, John Garnaut, Bill Gertz, Gerry Groot, Clive Hamilton, Alex Joske, Shanthi Kalathil, Peter Mattis, Jonas Parello-Plesner, Josh Rogin, Mark Stokes, Glenn Tiffert, and James To. 

A comedian, Chris Chappell, is even covering the issue and making it accessible beyond audiences for relatively dry scholarship and foreign policy analysis.
Ethnicities other than Chinese are also targeted, of course, but Chinese authorities single out those of their own ethnicity, putting them into particular danger. 

This is arguably a racist or discriminatory practice by China’s intelligence services, which victimizes and endangers overseas Chinese. 

A former attaché in the United States’ embassy in Beijing, for example, explained that China’s intelligence services target those of Chinese ancestry who work in foreign missions. 
“Ethnic Chinese serving in Western embassies in China bear special risks. Chinese intelligence services vigorously target them for compromise. The CCP treats them like race-traitors when they aren’t compromised, and their American countrymen are sometimes insensitive to the pressure they are under. I’ve known ethnic Chinese Americans that finished their service in China embittered by the experience.”

Another former attaché, this one defense attaché in the U.S. embassy in Bangkok, wrote that China’s strategy of targeting those of Chinese ancestry extends back decades. 

“Targeting the diaspora has long been the practice,” he said.
“In the 1980’s, when ethnic Chinese were still a rarity in the foreign service, it was the ethnic Chinese wives who were targeted. I know of a case of an American official in the Embassy in Thailand who had an ethnic Chinese-Thai wife, and he was being induced through his wife, who was dangled with tempting business propositions and offers of cash.”
The U.S. Central Intelligence Agency, tasked with assisting counterintelligence at U.S. embassies abroad, declined to comment.
Four sources of information in this article asked to remain anonymous because they were not authorized to speak on the subject, or because they feared reprisals.

China grabbed American as spy wars flare

A focus on Russia overshadows Beijing's aggressive tactics, including the kidnapping of a suspected American operative.
By ALI WATKINS


Both Chinese and U.S. officials kept quiet about the previously unreported incident, described to POLITICO and confirmed by multiple U.S. officials.

The sun was setting over Chengdu when they grabbed the American.
It was January 2016.
The U.S. official had been working out of the American consulate in the central Chinese metropolis of more than 10 million.
He may not have seen the plainclothes Chinese security services coming before they jumped him.
In seconds he was grabbed off the Chengdu street and thrown into a waiting van.
The Chinese officials drove their captive — whom they believed to be a CIA officer — to a security facility where he was interrogated for hours, and, according to one U.S. official, filmed confessing to unspecified acts of treachery on behalf of the U.S. government.
It wasn’t until the early morning hours of the following day that other U.S. officials — who were not immediately informed by their Chinese counterparts of the consular official’s capture — arrived to rescue him.
He was eventually released back to their custody and soon evacuated from the country.
Both Chinese and U.S. officials kept quiet about the previously unreported incident, described to POLITICO and confirmed by multiple U.S. officials.
But it threatened to spill into an international incident in the early days of the 2016 presidential campaign.
U.S. officials strongly protested the abduction to their Chinese counterparts and, according to one official, issued a veiled threat to kick out suspected Chinese agents within the U.S.
U.S. officials consider the abduction an unusually bold act in a long-simmering spy game between Washington and Beijing, one recently overshadowed by a newly aggressive Russia.
But U.S. officials and China experts say the two countries are engaged in an espionage battle that may be just as fierce, if far less publicized.
“The Chinese have not gone away,” one counterintelligence official who recently left government said.
“The things going on with Russia right now really have distracted from China.”
POLITICO spoke with more than half a dozen current and former national security officials for this story.
Almost all requested anonymity to more freely discuss sensitive intelligence matters.
China’s ongoing espionage within the U.S. was clear at a July pre-trial hearing at a Washington courthouse for former CIA officer Kevin Mallory, charged in June with passing at least three top secret U.S. government documents to a Chinese intelligence operative in exchange for $25,000 in cash.
“Your object is to gain information, and my object is to be paid for it,” prosecutors said the 60-year-old Mallory, then a government contractor, wrote in a message to a Chinese agent.
During the packed hearing, Mallory, who sat quietly in a dark jumpsuit, showed little emotion as prosecutors played a recording of a phone call he made to his family in which he frantically directed his children to find a device on which he stored information, including CIA material, for his Chinese contacts.
On the recording, Mallory can be heard worriedly shushing his son as the boy begins to describe the device—perhaps out of well-grounded fear that federal investigators might be listening.
Government witnesses testified that data Mallory allegedly stored on the device was sensitive enough to compromise critical U.S. intelligence gathering inside China—and specific enough to reveal and gravely endanger U.S. sources there.
The CIA and State Department declined to comment.
Some officials and China experts said Beijing uses a softer touch in its espionage.
Where Moscow stomps, Beijing tiptoes — focusing heavily on the theft of economic secrets and making no known effort to influence U.S. electoral politics.
China is an uneasy partner for the U.S. — particularly as Donald Trump seeks Beijing’s help in taming North Korea’s nuclear program.
And American corporations that care little about Russia’s stunted economy want good relations with China’s potential market of more than 1 billion consumers.
“It’s a much more sophisticated effort than Russia’s,” Daniel Blumenthal, a China expert at the American Enterprise Institute and a former commissioner of the U.S.-China Economic and Security Review Commission, said of Chinese spying.
“They’re stronger, they’re more ambitious, they’re more powerful. And there are more U.S. stakeholders who want a positive relationship with China.”
Mallory is just one of two U.S. government employees charged this year with passing U.S. state secrets to China.
The other, 60-year-old Candace Marie Claiborne, was a State Department veteran whose postings included Beijing and Shanghai.
A March federal indictment charged her with accepting tens of thousands of dollars in cash and gifts from Chinese officials, including a laptop computer and international vacations, in return for U.S. government documents on U.S.-China economic relations.
U.S. officials interviewed by POLITICO said that, while visiting China, their colleagues are often “pitched,” or approached by Chinese intelligence operatives trying to recruit them.
Chinese efforts to recruit spies expand far beyond U.S. government employees. 
In a 2014 counter-recruitment video, titled “Game of Pawns,” the FBI tells the story of Glen Duffie Shriver, who as a U.S. student in Shanghai struck up a relationship with a woman he eventually discovered was a Chinese government operative.
Shriver took $70,000 from the woman as he sought a U.S. government job that would give him access to secret information he could pass to his handlers. 
He was sentenced to four years in prison.
“We live in a very sheltered society," Shriver says in the video.
"And when you go out among the wolves, the wolves are out there."
One former U.S. official said the cases show the way Chinese intelligence services, which long sought to appeal mainly to Chinese-Americans, are now recruiting from a far broader pool.
“The way the Chinese have gotten more aggressive is, they’ve looked at recruiting more than just ethnic Chinese,” one Obama-era National Security Council official said.
Officials and experts are especially concerned about China’s 2015 hack of the Office of Personnel Management, which saw the theft of personal data from millions of U.S. federal workers.
That information went well beyond Social Security numbers or birthdays—officials confirmed that China-linked hackers accessed troves of “SF-86” forms.
That extensively detailed document—required for government employees seeking a security clearance—includes everything from relationships to the month-by-month minutia of a personal history.
The scope and detail of the files may serve as a kind of recruitment road map for years, Michelle Van Cleave, former director of the Office of the National Counterintelligence Executive, said at a U.S.-China Economic and Security Review Commission hearing this summer.
“The threat will grow as a result of their successes against us, because of the integration of those cyber successes and their human espionage capabilities,” Van Cleave said.
“I'm looking at what was lost through the OPM breach ... and I'm saying this is, this is staggering. This is staggering.”
The snatching in Chengdu is an extreme illustration of current and former officials' description of intense surveillance of Americans by Chinese security authorities in China.
The officials described how their rooms or belongings were “tossed” — searched by Chinese operatives — while they were staying in the country.
“They were as fundamentally aggressive in their activity [as the Russians],” one former U.S. diplomatic official told POLITICO.
Calling China’s approach more “subtle” than Russia’s, he added: “They always knew what we were doing and where we were.”

U.S. Chinese Fifth Column

FBI, other agencies work in buildings owned by China
By JOEL GEHRKE

Federal officials are putting sensitive materials in Chinese-owned buildings, making them vulnerable to cyberattack and espionage, senators warned Friday.
Their alarm bells were set off by a report that said the General Services Administration has been placing FBI agents and other "high-security" government officials in buildings owned by foreign entities in China.

The GSA didn't tell the tenants, according to the government report, so the officials aren't taking addition security precautions.
"Yet, in some cases the space is used for classified operations and to store sensitive data," Sen. Steve Daines, R-Mont., and Sen. Tammy Duckworth, D-Ill., wrote in a Thursday letter to acting GSA Administrator Timothy Horne. 

"Given the highly sensitive information that is often stored at high-security leased sites, we are concerned with the lack of policies and procedures concerning the ownership of these sites."
The Chinese-owned buildings have national security and privacy implications, as they house agencies ranging from FBI and Drug Enforcement Agency field offices to a Social Security Administration office in Seattle, Wash. 

Even the U.S. Secret Service rents space from companies based in China, according to the Government Accountability Office, which is the research arm of Congress.
The GAO warned that "foreign ownership of government-leased space can pose security risks particularly regarding cybersecurity," with particular reference to China. 

The report noted that "companies in China are likely to have ties to the Chinese government," as well as federal government warnings about Chinese government hackers targeting private and federal U.S. entities. 

"China is the leading suspect in the cyber intrusion into the Office of Personnel Management's (OPM) systems affecting background investigation files for 21.5 million individuals which OPM reported in July 2015," the GAO added.
Although the buildings are leased formally from companies based in foreign countries, GSA can't be sure that those private companies are the true owners of the buildings. 

"GSA lacks complete information regarding foreign-owned leased space including beneficial owner information (which GAO defined as the person who ultimately owns and controls a company)," the senators noted.
Federal agencies took extra precautions after realizing they were in a foreign-owned building, but nine of the 14 agencies contacted by the GAO didn't have any of that information. 

"Federal agencies are among the top targets for cyber criminals, with many agencies experiencing thousands of attempted attacks daily," Duckworth and Daines wrote. 

"Agencies must have the information necessary to assess and address the risks to their high-security facilities, including cybersecurity vulnerabilities that exist in foreign-owned buildings."
The lawmakers want an update on how GSA will change its leasing procedures and "notify tenants that their leased space is foreign owned." 

But they also need to learn more about which buildings are foreign-owned, according to the GAO. "The real property database did not include information on all of the buildings in which GSA leases high-security space," the GAO report says. 

"Therefore, the results of our analysis are likely understated and GSA may be leasing more high-security space than what we identified in the 25 leases."