Economy

Chinese firm charged with economic espionage

Chinese firm charged with economic espionage

The Department of Justice (DOJ) has charged today two companies -one from China and one from Taiwan- and three Taiwanese nationals for stealing trade secrets from a USA semiconductor company.

U.S. Attorney General Jeff Sessions told a news conference that Chinese espionage has been "increasing rapidly", and the government is launching a new initiative to crack down on Chinese espionage trade cases.

Attorney General Jeff Sessions made the announcement with comments published on the US Justice Department's website. We're not going to take it anymore.

"Obviously, that commitment has not been met", he said. "Just ask GE Aviation, or Trimble, of Sunnyvale, California", he noted.

The U.S. Commerce Department earlier this week also announced that it had put Fujian Jinhua Integrated Circuit Co Ltd on a list of entities that can not buy components, software and technology goods from U.S. firms.

US officials says the defendants, including a Chinese-owned company singled out this week by the Trump administration, targeted Idaho-based Micron over a technology it produces that stores memory in electronics. China has retaliated with tariff increases on $110 billion of American products.

In a tweet Thursday, Trump said he had spoken with China President Xi Jinping.

China-US trade tensions have erupted in tit-for-tat tariffs between the world's two biggest economies this year. "The Chinese government's complicity in intellectual property theft hurts American manufacturers, workers, and consumers, and undermines the ability of USA businesses to operate in China", Senate Intelligence Committee Vice Chairman Mark Warner, D-Va., responded. It is a threat to our national security. "And it is unlawful". While the focus has been on hackers from Russian Federation and Iran, the USA also views China as a major cybersecurity threat.

The initiative comes as the Justice Department sets its sights against China's cyberattack efforts.

But since 2017, three people have been charged with spying for China or attempting to spy for China. Other cases have involved stolen wind turbine technology and software source code.

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"Micron has invested billions of dollars over decades to develop its intellectual property", said Joel Poppen, Micron's general counsel.

The charges name two companies, one in China and one in Taiwan, and three Taiwanese defendants. They later went to work for United Microelectronics Corporation in Taiwan where they are alleged to have orchestrated stealing trade secrets from Micron.

The charges against Taiwan-based United Microelectronics Corp, China state-owned Fujian Jinhua Integrated Circuit, Co, Ltd and three individuals mark the fourth case brought by the Justice Department since September as part of a broader crackdown against alleged Chinese espionage on US companies.

That man, identified by prosecutors as Chen Zhengkun, recruited both of his co-defendants to join him at UMC. UMC then took legal action against Micron in January, alleging that the company infringed on patents in China related to memory storage and other products.

The China initiative will be led by assistant attorney general for national security John Demers, and composed of senior Federal Bureau of Investigation and Justice Department officials, Sessions said.

Congress in August passed laws to expand the government's power to review foreign investments in the country. "Today, we see Chinese espionage not just taking place against traditional targets like our defense and intelligence agencies, but against targets like research labs and universities".

The administration has characterized China, along with Russian Federation, as a strategic competitor of the United States.

"Nearly every one of our 56 FBI field offices throughout this nation has investigations into economic espionage that lead back to the country of China", Demers said. It wants to keep working with China without sharing key technologies.

In addition to the criminal case, the Justice Department filed a civil lawsuit seeking to prevent the two accused companies from exporting any products created using the trade secrets and blocking the further transfer of trade secrets.

The indictment was filed September 27 and unsealed Thursday, when the civil case was filed.