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Cyber and Beyond The Inner Workings of Chinese Espionage Overt Structure & Operations Joshua Philipp National Security Reporter Epoch Times [email protected]

Cyber and Beyond: The Inner Workings of Chinese Espionage

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Page 1: Cyber and Beyond: The Inner Workings of Chinese Espionage

Cyber and BeyondThe Inner Workings of Chinese Espionage

Overt Structure & Operations

Joshua PhilippNational Security Reporter

Epoch [email protected]

Page 2: Cyber and Beyond: The Inner Workings of Chinese Espionage

A Surface Look

“China has had a long reach into the Chinese community in the United States for quite some time, and frequently uses this community for espionage, both within the community itself and against American companies, the military and the technology and political spheres.”

● Chinese Consulate involvement

● Local businesses

● Social organizations

● Chinese student groups

● Chinese media

● Highly organized

● Participants paid cash

Page 3: Cyber and Beyond: The Inner Workings of Chinese Espionage

Central Committee of theChinese Communist Party

United FrontDepartment (UFD)State Council

Overseas ChineseAffairs Office (OCAO)

Consulates &Embassies

Tongs & HometownAssociations

Chinese Student andScholar Associations (CSSA)

Triads & Street Gangs

Overt Espionage Structure

Page 4: Cyber and Beyond: The Inner Workings of Chinese Espionage

Overall Goals● Create “united front” of Chinese in foreign countries

● Gain governance of overseas Chinese communities

● Push CCP narrative, while suppressing others

● Alter perceptions and allegiances

● Using indirect systems to pressure or influence government and media, in order to affect US policy on China

● Mobilize front groups for political purposes, create pressure or support where needed, use this for propaganda inside and outside China

● Recruit or plant foreign agents and insiders

Page 5: Cyber and Beyond: The Inner Workings of Chinese Espionage

Overseas Governance

"Control of the Chinese community is the CCP's consistent foreign policy. It has been a 'painstaking effort' over the past decades, and has a certain scale. It is a pyramid-like structure and system. They manipulate Chinese people in the name of 'unite overseas Chinese.' "

- Chen Yonglin

● Used Chinese students as special agents

● Control overseas Chinese media, provide financial support using advertisements from Chinese companies

● Pressure western politicians if they help Chinese dissidents, keep records of politicians which can impact ability to travel to China

Leaked documents from the Chinese Consulate in Sydney, provided to Epoch Times in 2007 by former Chinese diplomat Chen Yonglin.

Page 6: Cyber and Beyond: The Inner Workings of Chinese Espionage

Overseas Chinese Affairs Office

● Helps manage systems of overseas governance, with Consulates / Embassies functioning like city governments

● Helps build strategies and narrative

● Target Chinese immigrants, 2nd and 3rd generation Chinese, and Chinese immigrants with wealth or specialized skills

● Monitor and build databases on Chinese immigrants

● Assist embassies and consulates with PR efforts to Chinese community

● Build relations with Chinese immigrants running media, cultural organizations, and Chinese schools; and support their work.

“The target of overseas Chinese Affairs is Chinese who are living overseas and those who were nationalized as foreign nationals.”

- Jiang Zemin

Page 7: Cyber and Beyond: The Inner Workings of Chinese Espionage

United Front Department(formerly called the “United Front Work Department”)

● Expand the governance of the Chinese Communist Party into overseas Chinese communities

● Approach Tongs / hometown associations and sway allegiances, offer incentives

● Offer incentives to change allegiances

● Target community leaders, business elite, people with power

“The united front, the armed struggle, and party building are the three magic weapons of the Chinese Communist Party to defeat enemies in the Chinese revolution.

- Mao Zedong, October 4, 1939, first edition of “The Communists”

“Party committees at every level should include the united front in their agenda.”

- Deng Xiaoping, August 15, 1979, 14th national conference on united front work

Page 8: Cyber and Beyond: The Inner Workings of Chinese Espionage

Political Influence

Rose Pak

● “De facto head” of San Francisco's Chinese Chamber of Commerce

● An overseas director of the China Overseas Exchange Association (COEA), which is directly under the Overseas Chinese Affairs Office

● Allegations she controls local elections on behalf of moneyed mainland Chinese interests.

“COEA’s leadership is composed entirely of Chinese Communist Party officials representing various foreign affairs and 'overseas propaganda' agencies of the Chinese government.”

Page 9: Cyber and Beyond: The Inner Workings of Chinese Espionage

Harassment & Surveillance

“Chinese operatives and consular officials are actively engaged in the surveillance and harassment of Chinese dissident groups on U.S. soil.”

Page 10: Cyber and Beyond: The Inner Workings of Chinese Espionage

Pressuring to Spy

Mr. Qurban said Chinese agents detained him in China, pressured him to send reports on Uyghurs in Canada to Chinese operatives living there.

“They said, ‘People like you are our enemies. We will wipe you out for sure.’”

“They said, ‘We have special people there. All you have to do is give the information to them.’”

Source: http://www.rfa.org/english/news/uyghur/canadian-04242015121248.html

Page 11: Cyber and Beyond: The Inner Workings of Chinese Espionage

Silencing Unwanted Voices

“They said they can make me disappear ... It’s very common knowledge. If you speak about the Chinese Communist Party, even among co-workers, they’ll tell you to watch what you say.”

- Judy Chen, 55, Taiwanese immigrant living in Flushing, Queens

“All the Chinese people know it.” (Paraphrasing) On the local level, the Chinese regime often uses its influence over Chinese community organizations and student groups to carry out its work.

- Tang Baiqiao, founder of Democracy Academy of China

Page 12: Cyber and Beyond: The Inner Workings of Chinese Espionage

“Each of these programs looks to foreign collaboration and technologies to cover key gaps.”

They encourage Western-trained experts to help the CCP's technological development by returning to China or by “serving in place.”

- “China’s Industrial Espionage: Technology Acquisition and Military Modernization” (Book), by William C. Hannas, James Mulvenon, and Anna B. Puglisi

Programs for Economic Theft

Official Programs Include:

● Project 863

● Torch Program

● 973 Program

● 211 Program

Page 13: Cyber and Beyond: The Inner Workings of Chinese Espionage

Economic Theft“China's National Technology Transfer Centers”

aka “National Demonstration Centers”

“ We are talking here of an elaborate, comprehensive system for spotting foreign technologies, acquiring them by every means imaginable, and converting them into weapons and competitive goods.”

- “China’s Industrial Espionage: Technology Acquisition and Military Modernization” (Book), by William C. Hannas, James Mulvenon, and Anna B. Puglisi

● 202 centers work as “models for emulation by other transfer facilities.”

These Include:

● Science and Technology Office under the Overseas Chinese Affairs Office

● State Administration of Foreign Experts Affairs under the State Council

● National Technology Transfer Center under the East China University of Science and Technology

Page 14: Cyber and Beyond: The Inner Workings of Chinese Espionage

The Tongs

● Not all bad

● Varying allegiances

● Many with very large memberships (some claim hundreds of thousands)

● Some associated with Triads and street gangs, with varying allegiances

● The United Front Department targets them for their influence in Chinese

● After targeted, they act on behalf of the Chinese Communist Party

● Mobilized along with members for political or ideological purposes

● Use influence to control Chinese communities

● Use influence to affect foreign politics, law enforcement, and news coverage

● Highly useful for finding insiders in targeted industries

Page 15: Cyber and Beyond: The Inner Workings of Chinese Espionage

Tongs Working With Overseas Chinese Affairs Office

Case found guilty, and sentenced Xing Wu (Oliver) Pan & Jenny Hou for crimes including attempted wire fraud in John Liu's (former NYC comptroller) campaign.

● Xing Wu (Oliver) Pan, executive vice director of the Fukien American Association, and the United Fujianese American Association

● Jenny Hou's father is Hou Jianli, president of the Beijing Township Association

● Met with then-vice president of the Overseas Chinese Affairs Office, Xu Yousheng, during 2007 trip to China, escorted by tong leaders including Hou Jianli.

Page 16: Cyber and Beyond: The Inner Workings of Chinese Espionage

Triads & Street Gangs

“Once that organization, the Fukien American Association, became one of the leading [China]-supported organizations, they became the host of almost all these Chinese officials who are visiting New York.”

- Ko-lin Chin, Professor, Rutgers School of Criminal Justice, interview with Epoch Times

“The Fuk Ching, for example, are affiliated with the Fukien American Association ... They allow the gang to operate on their (the tong’s) territory, thus legitimizing them with the community.”

- “Chinese Transnational Organized Crime: The Fuk Ching,” by James O. Finckenauer, Ph.D., International Center, National Institute of Justice

● Used for strong-arm tactics

● Used when violence is needed

● Valuable for smuggling channels

● Drug warfare, culture warfare, etc

Page 17: Cyber and Beyond: The Inner Workings of Chinese Espionage

The Triads in Action

“The Chinese Communist Party ... has teamed up with a notorious triad figure to help press its claims in Taiwan.”

● Chang An-lo aka “White Wolf”

● Convicted kidnapper, extortionist, and heroin trafficker

● Mobilizes aggressive protests to intimidate pro-democracy activists in Taiwan

Page 18: Cyber and Beyond: The Inner Workings of Chinese Espionage

The Triads in Action

“This is one of the tactics used by the communists in mainland China from time to time. They use triads or pro-government mobs to try to attack you so the government will not have to assume responsibility.”

- Albert Ho, pro-democracy lawmaker

● Attacks on pro-democracy protesters

● Triads involved

● Rumors of Chinese Communist Party orchestrating

Page 19: Cyber and Beyond: The Inner Workings of Chinese Espionage

Chinese Student and Scholar Associations (CSSA)

“The Consulate provides funding and resources to each CSSA, which amounts to tremendous assistance, for this resolves all financial worries the student organization might otherwise have.”

– Blog by Chinese student in Canada, “Current situation and development of Chinese Student Association in Canadian Universities”, study in Canada blog (Accessed July 19, 2007)

“The vast majority of CSSAs receive funding from the Chinese government or have an active liaison via the consulate back to the CCP.”

– ICIT report

● Students mobilized for political or ideological purposes

● Act on behalf of the CCP within their universities

● Students groomed as spies in targeted positions, such as specific industries, government jobs, or government internships

Page 20: Cyber and Beyond: The Inner Workings of Chinese Espionage

The System at Work ...

“China is building large covert spy networks inside Australia's leading universities, prompting Australia to strengthen its counter-intelligence capabilities.”

● CCP building covert spy networks in Australia's leading universities

● Spying on ethnic Chinese

● Censoring information unfavorable to the Chinese Communist Party

Page 21: Cyber and Beyond: The Inner Workings of Chinese Espionage

Key Takeaways

● The CCP is taking advantage of the open system of the United States

● The CCP views overseas Chinese and their communities as part of China. This includes 2nd and 3rd generation immigrants

● Active intimidation in Chinese communities, which creates perception Chinese communities of being monitored and at risk – don't feel protection of US government

● Use of controlled overseas groups for political or ideological mobilization – protests appear spontaneous, but being orchestrated

● Efforts to influence US politics

Page 22: Cyber and Beyond: The Inner Workings of Chinese Espionage

Select Sources

– https://www.stratfor.com/weekly/terrorism_weekly_april_16

– http://www.japantimes.co.jp/news/2014/10/15/asia-pacific/politics-diploAmacy-asia-pacific/masked-thugs-hong-kong-rallies-revive-citys-triad-reputation/

– http://www.smh.com.au/national/chinese-spies-keep-eye-on-leading-universities-20140420-36yww.htm

– http://www.upholdjustice.org/node/181

– http://www.edu.cn/xiang_guan_lian_jie/zheng_fu/gwy_qiao_wu_ban.htm

– http://xcb.cumt.edu.cn/kddj/tzgz/ql/ldzs/_index.htm

– http://www.zytzb.org.cn/zytzbwz/theory/lilun/80200212170099.htm

– http://xcb.cumt.edu.cn/kddj/tzgz/ql/ldzs/_index.htm

– http://www.ynzxb.cn/2006/11-21/09331683794.htm

– http://www.tongxin.org/j-sys-news/page/2003/618/1674_552.shtml

– http://icitech.org/icit-brief-chinas-espionage-dynasty-economic-death-by-a-thousand-cuts/

– http://chinascope.org/main/content/view/4838/104/

– http://www.zytzb.cn/publicfiles/business/htmlfiles/tzb2010/S1815/201209/731224.html

– http://chinascope.org/main/content/view/2754/104/

– http://www.chinanews.com.cn/zgqj/2010/06-29/2370881.shtml

– http://www.upholdjustice.org/node/252#report252_4

– https://www.amazon.com/Chinese-Industrial-Espionage-Acquisition-Modernisation/dp/0415821428

– http://www.theepochtimes.com/n3/1737917-investigative-report-china-theft-incorporated/

– http://www.theepochtimes.com/n3/790894-chinese-expats-monitored-harassed-in-nyc/

– https://www.usnwc.edu/Departments---Colleges/Center-for-Naval-Warfare-Studies/Warfare-Analysis-and-Research/Readings-and-Refences/U-S--China-Economic-and-Security-Review-Commision.aspx

– https://www.ncjrs.gov/pdffiles1/nij/218463.pdf

– http://www.theepochtimes.com/n3/254901-in-backing-disgraced-treasurer-john-liu-sticks-close-to-beijing/

– http://dailysignal.com/2015/04/13/columbia-shut-down-student-group-known-to-be-beijing-front-group-what-does-that-mean/

– http://www.upholdjustice.org/node/172

– http://www.smh.com.au/world/chinas-rulers-team-up-with-notorious-white-wolf-of-taiwan-20140711-zt488.html

– http://foreignpolicyblogs.com/2016/06/09/beijing-hidden-influence-san-francisco/

Page 23: Cyber and Beyond: The Inner Workings of Chinese Espionage

The Inner Workings of Chinese Espionage

Overt Structure & Operations

Questions / FeedbackJoshua Philipp

[email protected]

Cyber and Beyond