Economic Espionage

The FBI has alleged that roughly 3,000 Chinese “front companies” have been established in the United States for the purpose of illegally acquiring military or industrial technologies. See Jay Solomon, Phantom Menace: FBI Sees Big Threat From Chinese Spies; Businesses Wonder, Wall St. J., Aug. 10, 2005, at A1.

According to the Wall Street Journal, “[t]he government is currently prosecuting about a dozen cases against individuals alleged to have sent technology—sometimes designs, sometimes software, sometimes high-tech equipment—to China illegally.” Id. One of the higher-profile cases involved Sun Microsystems and Transmeta Corp., “where two Chinese nationals who had worked at the software and semiconductor giants were arrested at the San Francisco airport allegedly holding proprietary data from the companies.” Id. They were charged with economic espionage and the case is currently pending. Id.

Economic espionage is a transnational crime which is taken very seriously by both the United States government and by international institutions like Interpol. Economic espionage is criminalized by 18 U.S.C. § 1831. Under that section, it is a crime for any person, who intends to benefit a foreign government, to knowingly

• steal, or without authorization appropriate, take, carry away, or conceal, or by fraud, artifice, or deception obtains a trade secret; 18 U.S.C. § 1831(a)(1);
• without authorization copy, duplicate, sketch, draw, photograph, download, upload, alter, destroy, photocopy, replicate, transmit, deliver, send, mail, communicate, or convey a trade secret; id. § 1831(a)(2);
• receives, buys, or possesses a trade secret, knowing the same to have been stolen or appropriated, obtained, or converted without authorization; id. § 1831(a)(3);
• attempts to commit any offense described in any of paragraphs (1) through (3); id. § 1831(a)(4); or
• conspires with one or more other persons to commit any offense described in any of paragraphs (1) through (3), and one or more of such persons do any act to effect the object of the conspiracy. Id. § 1831(a)(5).

A violation of section 1831 may be punished by a fine of up to $10,000,000, imprisonment for up to 15 years, or both.