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May 21, 2025 - Epoch Times
23:25
China’s Whole-of-Society Espionage Playbook: Nicholas Eftimiades
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China uses what we call a whole-of-society approach to conducting espionage.
In the U.S. or Canada, so we're not talking about hundreds or we're not talking about thousands.
We're talking about tens of thousands, if not hundreds of thousands, of people engaged globally in carrying out the CCP's will.
There are few people who understand Chinese espionage tradecraft, as well as Professor Nicholas Eptimiades.
After a 34-year government career, including time at the CIA, State Department, and Defense Intelligence Agency, he's now a professor at Penn State University's Homeland Security Program and a senior fellow at the Atlantic Council.
We have, out of Los Alamos, we've had 116 ethnic Chinese who have worked on critical technologies who have gone back to China.
He's the author of Chinese Espionage: Operations and Tactics.
And this is extraordinary.
U.S. universities that are working for China developing technologies that the U.S. government has told China it cannot import.
This is American Thought Leaders and I'm Jan Jekielek.
Nicholas Eftimiades, such a pleasure to have you on American Thought Leaders.
Thank you very much for having me.
You have incredible in-depth knowledge about The Chinese Communist Party's espionage operations in America and Canada.
How big, how deep of a problem is this really?
You know, one could argue at a strategic level, it presents the greatest threat to the US and Canada that we've seen since the fall of the Soviet Union, since Nazism.
Just justify that to me.
Well, China uses what we call A whole-of-society approach to conducting espionage.
In the US or Canada, whether it's the RCMP or CSIS in Canada, or the CIA or the FBI in the United States, the intelligence agencies work sort of unto themselves.
You know, they recruit spies, they arrest spies, that's what they do.
Not so in China.
China engages entire society.
For not only collecting information, but the subversion of other nation states.
So we're not talking about hundreds or we're not talking about thousands.
We're talking about tens of thousands, if not hundreds of thousands, of people engaged globally in carrying out the CCP's will.
It's really an extraordinary effort in the magnitude and scale.
Well, and here's the thing that...
I find fascinating and incredibly difficult to deal with is there's this very powerful incentive structure because of this whole-of-society approach that essentially could co-opt almost anybody.
Yeah, there actually are two avenues at play.
Number one is the incentive structure.
And the incentive structure means because the CCP has such a dominant power control of China, if you want to get anything done, If you want to advance in China, your social credit scores, your businesses, your position, what you might have in China, the safety of your family, you have to be on good terms with the CCP.
Students who go abroad, people who are abroad, are questionable by the CCP.
And so they have to do acts to prove themselves to the Chinese Communist Party.
So what we find is collection efforts, people flying drones over military bases, classified facility.
We find people penetrating military bases.
We find people doing all sorts of acts of espionage.
There is also a concerted effort through the state-owned enterprises.
China had 300,000.
Now they have about 150,000 state-owned enterprises, 50,000 of which are at the central government level.
About 112 are really large-scale, several hundred thousand employees.
Are controlled and they do some collection activities, theft of technology in particular, economic espionage, on behalf of the CCP.
So you have that entire structure, which would be unheard of in free democracies.
You have universities in the same way, you know, collecting on behalf of the CCP.
I mean, we've seen this.
I have, you know, over 50 some odd number of universities have been identified in court documents in economic espionage cases.
So we see this at the corporate structure.
We see this at the university structure.
We see it in China's intelligence agencies.
So this is what I mean by a strategic threat.
It's a threat on a scale far vaster than any of our services, our counterintelligence, our security services are used to dealing with.
And in our democracies, we just don't have the structure to deal with this type of threat.
I couldn't help but notice that Professor Charles Lieber...
Recently got a position at Tsinghua University.
And so I don't typically like to focus on specific individuals, but I think this case is kind of illustrative, especially since he was found guilty.
Maybe if you could kind of paint me that picture and what it means that he's now at Tsinghua University, of all places.
Well, Professor Lieber was arrested because he was taking grants, in this case from the Air Force, for about $15 million and providing the same work to China.
I just want to mention, and nanotechnology, like some of the most sensitive, you know, cutting edge.
He's one of the top nanotechnologists in the world.
I have to mention that, but please continue.
He's one of many, I mean, who do interesting things like that.
We have, out of Los Alamos, what they call the Los Alamos Club, we've had 116 ethnic Chinese who have worked with classified clearance, with clearances, on critical technologies who have gone back to China.
And we have been able to identify some of the areas, including nuclear submarines and weapons systems that they've worked on back in China, because they publish on it.
And so we've been able to track everything that they've worked on.
Is this illegal?
No.
They say, I want to go back to China.
China's recognizing their citizenship and go back to it.
Technically, should they be taking back the classified knowledge and using that in the development of China's, in this case, military weapon systems?
No, they shouldn't be.
But we're paralyzed as a bureaucracy in doing anything about this.
We have a similar situation with Canada.
Two dozen Canadian pilots, military pilots, have been in China training the Chinese PLA Air Force.
I mean, training in NATO combat tactics.
So, we don't have case law that says, That's against the law.
We know you're getting $300,000 a year, but you can't do that.
So situations like this come up all the time.
What about this case of the incredibly prominent nanotechnology professor being found guilty?
What exactly was he found guilty of?
How serious was the punishment?
And how is it that he's now working for a Chinese university?
Well, the punishment should have been jail time, which he didn't get.
In this case, Professor Lieber...
He lied to the government on a contract, and that's called 18 U.S.C.
1001.
What he did was he was working for China, the same thing that he was doing for the Air Force, but not telling them.
So you can do that.
You can go work for China, but then the Air Force would have said, you're not taking our money.
You're not doing your projects working here.
But he didn't do that.
He specifically told them, you know, he wasn't.
He filled out the paperwork and said, I'm not working for China.
So what these cases wind up to be is not so much the term economic espionage, but fraud.
A person really conducting fraud.
It's the easiest charge to get on this because it's easily provable.
But what you find is that there are many, many, many more cases of this with people working for China.
While they're cutting-edge academics working on nanotechnologies and biotechnologies in the United States, and they're working for China at the same time, the only difference...
It's common in academia.
The only difference is those are generally considered questions of ownership of the research and not federal charge of fraud because they don't have federal contracts.
We see a number of universities...
And this is extraordinary.
U.S. universities that are working for China, developing technologies that the U.S. government has told China it cannot import.
So you can't export this technology.
And China says, OK, one of our universities goes to partner with a U.S. university and develops a technology.
Or Chinese companies like Huawei pay a U.S. non-profit.
Which then turns around and sponsors research at a company at a university in the United States to provide that technology to China.
So, I mean, we're leaking all over the place in critical technologies, technologies that give China a competitive edge commercially and militarily.
I mean, it's absolutely astonishing.
I mean, I happen to know that this sort of thing is happening, but when you lay it out like this, it's like, what are we doing?
Yeah, it's out of control.
But even today, right, where the, let's just say, the level of understanding of the China threat is the highest it's been ever by a margin.
I imagine you would agree with my statement here.
Yeah, absolutely.
I mean, I gave my first testimony before the Congress.
In the 1990s, based on my first book, four times testified before Congress.
And one of the things I tried to leave with them was saying, look, do something about this problem now.
Because if you don't do it, you'll be calling me back in 20 years, screaming, my God, how did it get this bad?
Well, we're 30 years later and it's worse than ever.
The only difference now is the realization on the American policy apparatus that they've let it atrophy for so long that we're in a big...
When you say atrophy, do you mean the counterintelligence work?
Not only the counterintelligence work, it's the insider threat awareness.
It's the ability to deal with China's cyber hacking campaigns.
Theft of intellectual property, trade secrets through cyber.
Our response?
Build bigger walls.
I got it.
That's reasonably effective.
We're building bigger walls.
And if you're the government building bigger walls to protect yourself, then you and I, the taxpayer, pay for it.
If you're a company that's building bigger walls, the consumer pays for it.
There's no cost to China.
China just steals it like crazy.
I mean, what kind of...
You think about it?
When you say walls, you mean like cyber?
Yeah, cyber walls.
Defensive walls.
That would build up.
We invest in that, and they invest in offense.
Generally, the offense is the one that wins.
And we've seen criminal gangs that support the Ministry of State Security.
Not only are they stealing technologies, but they're actually doing denial-of-service attacks and ransomware attacks and actually doing criminal activities in addition to that.
You have a criminal state.
It's simply the bottom line.
You have a criminal state that supports these to degrade the United States and to further the greatest transfer of wealth in history.
Professor Eftimiades, we're going to take a quick break, and folks, we're going to be right back.
And we're back with Professor Nicholas Eftimiades, author of Chinese Espionage.
You know, something just struck me.
We were talking about counterintelligence.
I wonder if there's even some people out there, we hear the term often, but I wonder if there's some folks who don't even know what that entirely means.
Why don't you tell me?
Well, counterintelligence, you know, for every intelligence service and for their activities, They're trying to counter an opposing intelligence service.
So we have counterintelligence, which is you're trying to oppose the general things that a foreign intelligence service does.
And we have counterespionage, which is specifically going after an espionage operation, trying to flip it, turn it around, use it to your benefit.
In the United States, as in Canada, as in free democracies, those intelligence...
Counterintelligence capabilities are built around the classified world.
They're built around our classified military information, our classified intelligence information, nuclear information, all that classified stuff.
China's strength is that it strikes at the political apparatus where there is not this type of counter capability in place because we have free and open democracies, which is why you see So many accusations and investigations of Canadian parliamentarians and evidence that they've been supported by the Chinese embassy.
We see that all the time.
We see the same thing in the United States.
Linda Sun, a recent case, even at the state level, right?
New York State, and she for 12 years was supporting the Chinese Communist Party, you know, the United Front Work Department, and thwarting Taiwan, you know, their policy initiatives.
Working for the governor.
Yeah, I'm sorry.
While she was working for the governor, two successive governors, Cuomo and Hochul, over the course of 12 years, you know, running China policy for New York, basically.
Right?
Literally running China policy.
Write this stuff.
No, no, you can't.
It's just amazing.
I read your section about and your case studies of the transnational repression with great interest, including the Linda Sun example, but because it's kind of a big area that I've been interested in for decades.
You've looked at, I forget, there's almost 900 cases for this book, right?
And not of transnational repression, that's just a piece, but can you just explain to me what you found broadly in that realm?
In the transnational?
Yeah, and also define it for me, too, because, again, it may seem to be obvious, but it maybe isn't obvious to everybody.
Okay, so let's start with our definition.
Our definition of this is China, in our case China, reaching out past its borders globally.
To exercise the CCP's will to shut down any dissent, to co-opt and to pull people, organizations, governments, etc., to support the CCP through manipulation, through bribes, you know, whatever, and then to firmly destroy any opposition to the CCP globally.
So they actually have a bureau in China's version of the CIA, the Ministry of State Security, which is responsible for doing work for the United Front Work Department, going
I mean, you list some of the most shocking examples.
Prominent ones are Fang Christine Fang, as you describe her.
Right.
So she was a case, I guess, in around 2015, and was seen often with Congressman Swalwell, who ran for the presidency at that time as well.
And the FBI picked her up on surveillance, meeting regularly with a Ministry of State security officer out of the consulate.
They followed her.
Turns out she was very close to Congressman Swalwell.
Well, and the thing that's most interesting about that case to me is the duration or the commitment to the development of the relationship.
I don't want to necessarily...
I don't have a particular interest in singling out Congressman Swalwell, but just in terms of the tradecraft, if you could kind of paint that picture for me.
So, in fact, the Ministry of State Security has a term for this, Chen Diyu, which...
Translates literally to bottom-sinking fish or fish on the bottom of the ocean.
It is a long-term asset.
So they put a person in place, in this case, someone who is very friendly with politicians, representing the Chinese community as she used to sell herself, and representing the Chinese diaspora, getting very close to politicians, and then leave that person in place for decades.
That's the objective.
Not a very large investment on the part of the Ministry of State Security, but it is a long-term investment that always brings forth results.
You posited a strategic response, which is, I don't know if it was reciprocity or not.
The reciprocity is what's in my mind.
Yeah, one of many approaches.
Right.
Well, so flesh that out for me.
Our alliances.
I mean, at a minimum five eyes, but our alliance is through NATO.
If an individual steals technology from the US or is found doing covert influence in Canada, the response has to be from all of us.
We're going to do a no-fly list.
No-fly is for people who do technology theft.
We're going to do a list of, if you're an academic and you steal research, you don't publish anywhere.
You don't get visas to come to academic conferences.
You don't publish in the West at all.
So, you know, that type of reciprocity, you have to ask, and I do ask policymakers, where do you see the relationship 15 years from now?
What do you want it to be like?
What do you want China to be like?
That's the first part.
I get blank stares, but that's the first part of this.
Understand and crystallize for all our Western partners.
What do we want out of them?
Where is this going to be in 15 years?
And what we want is ultimately a beneficial for all sides trade system.
We want to be able to work together on global issues, regional and global issues, free exchange of ideas.
Those are, you know, straightforward things.
What we don't want is threats against our citizenry.
We don't want theft of our technology and our, you know, and our trade secrets.
We don't want military threats.
We're on untested turf in a lot of ways.
I mean, the Foreign Agents Registration Act hasn't been updated since 1938 when we were dealing with German propaganda.
It's all got to be done in the U.S. and it's got to be physical.
You know, it's a little out of date.
So our legal institutions have to update laws so that we're better able to affect this.
And recently, laws dealing with Falun Gong are a great start in a good direction to support human rights.
Oh, you're thinking about the Falun Gong Protection Act just passing in the House yesterday.
Quite literally, yeah.
Well, actually, so on this point, I wanted to ask you, we were talking offline about just how, in some ways, it might seem odd that the Chinese regime is so obsessed with the Falun Gong, with the Shen Yun dance performance, to the point where there's Chinese agents in jail because they tried to get the non-profit status of Shen Yun revoked.
to people that IRS...
People that turned out to be FBI agents.
To us, it appears obsessive.
What we're talking about is Chen, I forgot his first name, who is in jail now, who actually in jail said he was a member of the 610 office in China, and he described it as a spy agency, told that to his cellmate, which is responsible for the eradication of Falun Gong globally.
If I may for a moment, they have an agency committed to the eradication of Falun Gong globally.
Yes.
Isn't that in itself, I mean, I'm familiar with this agency for the last, you know, 25 years.
However, isn't that astonishing, just kind of from a bird's eye view, that there would be an agency for this purpose?
Unlike our own intelligence agencies, you know, the lion's share of their effort goes towards protection of the party, okay, as opposed to the nation.
So, they deem Fungang a threat to the party because they have an ideological belief, they have a spiritual belief that they believe is a threat.
They look at people who advocate for democracy, they're a threat.
People who advocate for Taiwan independence, they're a threat.
The Uyghurs, they're a threat.
Tibetans, they're a threat.
You know, anyone who advocates for a position that's different from China, the five poisons as we call them, anyone who advocates for a different position from the CCP is immediately considered a threat, but now they have the means and the capability to go globally and destroy that threat.
That's what we're seeing.
This has been an absolutely fascinating conversation.
Any final thought as we finish?
Former Director Wray of the FBI used to say we have One case every 12 hours that arises dealing with China.
Two cases a day, times 365, 730 cases a year.
Some of these take months and months to resolve.
So thousands of cases in the rears.
And what that tells us, tells us to the FBI, is that we, whether it's the U.S. or any of the Western nations, freedom-loving nations, cannot arrest our way out of these situations.
We can't.
We're failing.
As it is now, we are failing.
So someone's got to do something.
Our political apparatus has to step up.
Our governments have got to step up.
And we've got to change the way we're doing things to turn ourselves towards succeeding.
And that, going back to the very first question you asked, is why this becomes so critical.
Because it's not something that we're used to dealing with.
Well, Nicholas Eftimiadis, such a pleasure to have had you on.
Thank you.
It's been a pleasure to be here.
I appreciate it.
Thank you all for joining Professor Nicholas Eftimiadis and me on this episode of American Thought Leaders.
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