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FBI spy chief asks private sector for help

Szady highlights threat of Chinese espionage

Russia, Iran, Cuba, North Korea and China are said to be engaging in espionage against the United States.
Federal Bureau of Investigation (FBI)

WASHINGTON (CNN) -- The FBI's leader in spy catching used a rare public appearance Thursday to ask American business to help stop the theft of U.S. business and technology secrets.

FBI Assistant Director for Counterintelligence David Szady, cited Russia, Iran, Cuba and North Korea among countries he said engage in espionage against the United States, but he focused heavily on activities by Chinese.

"There are 150,000 students from China. Some of those are sent here to work their way up into the corporations," Szady said. There are about 300,000 Chinese visitors annually, and 15,000 Chinese delegations touring the United States every year, 3,500 of them in the New York area alone, he said.

Szady, one of the speakers at the three-day National Intelligence Conference and Exposition in Arlington, Virginia, said it is important for companies and institutions to know with whom they are working.

He estimated that about 3,000 false-front Chinese companies operate in the United States, and urged private-sector employers to "partner up" with FBI agents to help protect national security.

"The economic viability of the United States we now look at as a counterintelligence problem," he said.

"We now see almost all of the adversaries, the Chinese being a classic example, of using students, delegations, researchers, visitors ... and false-front companies," Szady said.

Another senior FBI official, who spoke anonymously, was more blunt.

"The Chinese are stealing us blind," he said. "The 10-year technological advantage we had is vanishing."

The FBI has been successful, he said, in making some arrests.

"We took down some cases in Milwaukee, Trenton, New Jersey, and Palo Alto. These were false-front companies that were stealing technologies for the Chinese. Every person arrested was a student. They studied here, got their PhD here, and went to work for places like Lockheed, Raytheon, and Northrop."

Szady said spies do not limit espionage activities to large cities, and the Chinese presence is pervasive. "Even as we increase our numbers of agents, we can't possibly totally stop it," he said.

"If you have a little national asset, whatever it is ... they want that little thing that you produce," he said. "And they need it to make their missile fly straight or so they can compete in electronic warfare, and you have that key component."

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