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INDUSTRIAL INTELLIGENCE AND THE CHINESE COMMUNIST PARTY

Guillermo D. Jalil, M.S.

RELEASED:  ANNUAL REPORT TO CONGRESS: MILITARY AND SECURITY DEVELOPMENTS INVOLVING THE PEOPLE'S REPUBLIC OF CHINA 2011

The Chinese Communist Party(CCP) is the most prolific group at stealing industrial technology from American and European companies.  This is done through a number of privately held corporations, groups and associations operating in China and the United States, influenced by or controlled by the CCP; directly or indirectly.  For this posting, the CCP is mentioned for their adept theft of technology, even if private actors are in play.  If  Chinese nationals are mentioned, they are referred to agents of the CCP.  Obviously, not all Chinese nationals like or work for the CCP.  Many Chinese nationals fear the CCP, even when living in the United States.

First and foremost, the CCP seeks US and European technology at any cost.  They don't just seek to sell us toys, TV's, electronics and food.  They seek to steal technology anywhere and anyhow they can get it.  Most of this theft occurs at the doorstep of American and European companies.  I characterize the CCP as the "BORG" in the movie StarTrek-- "You will be assimilated."  They seek to obtain information and technology, and to share it amongst themselves and their affiliated groups.  What is gained by one group is shared among all within their network.  What is shared by all may work to the advantage of a group within the CCP, affiliates, financed businesses and others.  These groups may involve corporations, associations, non-profits, cultural centers, and individuals working in concert within the United States, Europe and China; in various forms. 

For the most part, the CCP operates within the borders of the United States without detection or interference.

The following are several techniques used by the CCP to steal industrial and state secrets:

1.  Honey-pot(*Honey-trap"):  Sexual bribery leaves no paper-trail.  Business executives, with access to technological insight are susceptible due to the following issues:

  • Divorce, or threat of divorce, is used to control the target.  Extortion and blackmail is often used to gain cooperation, and to keep the target silenced.  The targeted executive or engineer is pressured to reveal company secrets to avoid an embarrassing and expensive divorce.  Then the divulged secrets are used to keep the target silent for fear of divorce or loss of employment.

  • Executives with a heavy travel schedule often find themselves in need of affection.  Affairs are common.  This is an opportunity to expose the target.

  • Extended relationships with Chinese girlfriends, working for the CCP, often lead to introductions to others within the social circle of the executive.  A map is created of the executives social life, their respective access to technology, and to introduce additional operators into the group.  Those operators are usually introduced as interns, exchange students, and company visits by Chinese groups.  These groups don't necessarily involve a honey-pot, but may introduce a honey-pot in the near future.

  • The executive or engineer is often in denial that industrial espionage is taking place.  The executive perceives himself as "too smart" to be taken advantage of by a sweet and naive looking young Chinese female.

  • Once the espionage is detected, the executive often will hide the leak to avoid exposure to prevent damage to his family or career.  This means that the opportunity for damage control is lost due to the obfuscation of the executive.

  • Computer hackers and spy software are often used to detect the sexual interests, desires and fantasies of the targeted executive.  Often times, interest in sado-masochism and fetish related activities, and revelation thereof, often translate to a specifically targeted campaign to seduce the target along the same interests.  Pictures and covert video are often taken of those acts are used to black-mail the target to divulge secrets.  As the sexual interests increase in their "taboo" levels, this translates into increased operational control over the targeted executive.  For example, an executive's interest in pedophilia is more powerful leverage, over the target, than a sexual interest in S&M.  The illicitness of the activity brings forth enhanced control due to possible prosecution, embarrassment, and loss of employment.  Human trafficking and third party "massage parlors" are often connected to the CCP activities involving sexual bribery, blackmail and extortion.  Hidden cameras are a staple in the blackmail crime.  Many times, the crime of blackmail will eclipse the sexual crimes of the target, the jeopardizing of national security matters, and complete manipulation of a system of controls to prevent unauthorized disclosures.

  • The target's sexual habits and preferences are kept on file for future use.  The target is often re-targeted within months.  As often happens, males simply forget previous transgressions and are pliable for repeated seduction, manipulation and control.  Males, in particularly, are considered stupid.  This is true. They know better and yet, are so careless, that if confounds the imagination.

  • An executive's Facebook page is often used to determine social class, activities and a list persons to notify as part of a blackmail campaign.  A Facebook page may reveal a prospective target's social class, position in a hierarchy, level of compensation, marital status, and other concerns.  The pictures on Facebook, and other sources, commonly reveal the target's geo-positional location, and where he is likely found; and where to find his children.

2.  Companies are invited into a partnership with a Chinese company.  This requires that the US Company train the Chinese engineers.  Then the Chinese company will build a competing product line often under another company name.  This is referred to as the "mushroom factory."

3.  Several US companies are invited to bid on a project.  They are repeatedly invited to increase their technological offering, by revealing secrets.  This is done with several competing US companies so they reveal as many secrets as possible.  Then once the Chinese have enough stolen technology, they will cut off the American companies and build their own product line.  This is known as the "Lamprey Technique."

4.  Chinese interns, as agents of CCP companies, work within American companies and steal technology.

5.  The CCP encourages that the United States borrow as much money as possible; indebting the company to the Chinese.  Bill Clinton released classified nuclear secrets involving the submarine launched Polaris missile.  The Monica Lewinsky scandal was used to divert attention from this revelation.  In fact, the released secrets of space technology was enough for China to modernize their nuclear arsenal.

6.  The CCP also penetrates the United States using illegal money into US Elections directly from the Chinese Army.  An example of this was when the Chinese Army donated to the DNC, "Chinagate", involving John Huang and Johnny Chung.  Bill Clinton armed the Chinese with US nuclear technology.  Many of those modern missiles are now pointed at the United States today.

7.  The CCP uses Strawman entities to harass people, groups and others who are contrary to the agenda of the CCP.  For example, the CCP often utilizes social groups to exclude Falun Gong practitioners from parades in the United States, and to marginalize any Chinese group contrary to the interests of the CCP.  Most Americans aren't aware of the CCP's influence and operations within the borders of the United States.  In fact, most Americans, that consider the CCP, may envision a hollywood type invasion in the form of a "Red Dawn" type drama.  On the contrary, the economic invasion has already occurred.  It's here in the form of CCP companies, associations, and funded groups who collect data, intelligence and industrial secrets to make America weaker, and to strengthen the CCP's ability to modernize the Chinese military, and influence.  It's a slow and gradual, and creeping influence unlike an invasion of force.  Rather, the impact is insidious because of the stealth, silence, and deception in the great game.

8.  The CCP loans money to Chinese companies, and those companies are obligated to share information.  As such, most Chinese companies are agents of the CCP in one form or another.  Never forget this relationship.  Money, sex, financing, technology and information usually flow along the same channels, paths and associations.

9.  American companies are known for their need for immediate gratification in terms of short term gains.  The leadership of American companies lack responsibility to their consumers, their stockholders and their rank and file.  They are primarily concerned with themselves.  This leads to gaping holes in security, loss of secrets and loss of business.

CASE IN POINT: http://www.businessweek.com/articles/2013-02-14/a-chinese-hackers-identity-unmasked

The CCP is a well-organized and funded, and cunning adversary to the keeping of American and European technological secrets.  Do not underestimate them.  So far, they are extremely effective.  The Americans and the Europeans are asleep at the technological wheel.  For the most part, the Americans seek to close the door after the chickens sprung the coop. 

The retaining of our technological secrets are more important than ever before.  In the post 9/11 world, the United States has raised barriers to immigrants through the increased filing fees and in scrutiny of immigration visas.  This means that international students face heightened difficulty in studying and staying in the United States.  These students often become the entrepreneurs of tomorrow.  Most of the entrepreneurs in the Silicon Valley are Chinese or from India.  Discriminating against Chinese nationals jeopardizes American economic and political security.  Considering that US students lack advancement in Science and Mathematics, its critical our nation attracts students in needed disciplines.  A knee-jerk reaction in the unfair restriction of Chinese nationals immigrating to the United States may lead to unintended and negative consequences.  It's important to welcome Chinese nationals to study and work in the United States, without willingly or negligently releasing industrial technology to China. 

We must remind ourselves that the CCP is an adversary to be respected, and not underestimated.

The purpose of this article is to illuminate the related issues to industrial espionage conducted by the CCP.  This article is no reflection on the Chinese people.  On the contrary, the American railroad and road construction advanced greatly on the shoulders of hard-working Chinese laborers.  They endured much hardship, dangerous work conditions and unjust discrimination at the hands of American business owners.  They served our military and started countless legitimate businesses.  The Chinese contributed greatly to American culture and everyday life.  Their family cohesiveness and teamwork are examples of their strength and unity.  There's much to learn from the Chinese.  Please keep in mind to remain an Equal Opportunity Employer to all employees of Chinese descent.

Chinese General Redux:  Chi Haotian's Speech and Bio

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