Oregon, Texas – Federal agents tracked down and arrested two alleged Chinese spies across multiple states—from China to Houston to cities and military bases in Oregon, Washington, and California—for operating as agents of the People’s Republic of China (PRC) while targeting U.S. Navy personnel.
Last week, a multi-agency investigation reached its peak when law enforcement officers disrupted what the Department of Justice described as a “clandestine PRC Ministry of State Security Intelligence network operating in the United States.”
FBI Houston and Houston Police officers arrested Liren Lai on Friday for allegedly conducting clandestine intelligence operations. The Houston FBI explained that Lai worked to identify U.S. Navy personnel for potential recruitment by the Chinese Ministry of State Security. Lai, a PRC national, arrived in Houston in April and overstayed his tourist visa.
On the same day, FBI Portland agents arrested Yuance Chen, 38, a PRC national and legal permanent resident, in Happy Valley, Oregon, on similar charges. Both suspects appeared in federal court in Houston and Portland on Monday.
The U.S. Attorney for the Northern District of California issued the charges and leads the prosecution. Authorities charged both men with conducting clandestine intelligence operations in the U.S. on behalf of the PRC’s foreign intelligence service, the Ministry of State Security (MSS), including targeting U.S. Navy personnel and bases.
“This case underscores the Chinese government’s sustained and aggressive effort to infiltrate our military and undermine our national security from within,” Attorney General Pam Bondi said. “The Justice Department will not stand by while hostile nations embed spies in our country – we will expose foreign operatives, hold their agents to account, and protect the American people from covert threats to our national security.”
“The Chinese Communist Party thought they were getting away with their scheme to operate on U.S. soil, utilizing spy craft, like dead drops, to pay their sources,” FBI Director Kash Patel said. “This case was a complex, coordinated effort and is an example of outstanding counterintelligence work done by FBI San Francisco, Portland, Houston, San Diego, and the [FBI’s] Counterintelligence Division.”
Assistant Attorney General for National Security John Eisenberg explained that PRC MSS operatives “dedicate years to recruiting individuals and cultivating them as intelligence assets to do their bidding within the United States,” and the FBI’s National Security Division works to “neutralize our adversaries’ clandestine spy networks.”
Omar Lopez, director of the Naval Criminal Investigative Service (NCIS), added that “the PRC has for years attempted through various means to recruit U.S. service members as intelligence assets due to their access to sensitive military information.”
Investigation Details
The criminal complaint, unsealed on Tuesday, reveals that the PRC government conducts intelligence activities against the U.S. through multiple agencies. The MSS focuses on collecting civilian intelligence, counterintelligence, foreign intelligence, and political security. MSS operatives work to obtain information on political, economic, and security policies that might affect the PRC, along with military, scientific, and technical information valuable to the PRC. The complaint identifies the U.S. as the MSS’s principal target.
The charges allege that Lai recruited Chen in 2021. In early January 2022, they facilitated a $10,000 cash dead-drop payment in Livermore, California, on behalf of the MSS.
The suspects also targeted Navy personnel at a naval installation in Washington and a Navy recruitment center in San Gabriel, California. They shared information they obtained about Navy recruits with the MSS, according to the charges. Chen also received instruction from the MSS on how to engage and recruit future Navy sailors, contacted at least one Navy employee over social media, provided information about the employee to the MSS, and met with MSS intelligence officers in China several times, according to the charges.
Travel and Immigration Violations
Lai told immigration officials he traveled to Houston for business as an online retail seller and planned to stay for two weeks. After overstaying his tourist visa, he traveled by car to southern California and returned to Texas.
Potential Penalties
If convicted, both suspects face up to 10 years in prison and a fine of up to $250,000.
Broader Context
This announcement follows a U.S. House report that identified hundreds of Chinese espionage incidents within three years under the Biden administration. The Department of Homeland Security also warned police about Chinese signal jammers being used to thwart operations.
The arrests also come after the greatest number of Chinese nationals illegally entered the U.S. under the Biden administration—more than 176,000 nationwide—raising national security concerns.
