New Spy Case Prompts Skepticism

Southern California’s Chinese community is watching another spy scandal developing in its backyard, and some have a sense of deja vu.

The latest case involves four people arrested last month on multiple charges of stealing U.S. military secrets from an Orange County aerospace firm for the People’s Republic of China.

Federal authorities initially accused Chi Mak, wife Rebecca Laiwah Chiu, Tai Wang Mak and his wife, Fuk Heung Li, of the theft of government property, conspiracy, transporting stolen goods and aiding and abetting.

But when a federal grand jury returned indictments Tuesday, three were charged only with failing to register as agents of a foreign government; all charges were dropped against Fuk. One reason for the reduced charges, officials said, was because the data the defendants allegedly passed along turned out not to be classified.

The case has generated much discussion in the Chinese community, but the decision by the prosecutors to drop some of the more serious charges has underscored the feeling of some that there is more smoke than fire in the U.S. effort to crack down on Chinese spying.

When Lisa Yang, a local developer and president of the Chinese American Citizens Alliance, heard about the spy case, her first reaction was “Uh-oh, here it comes again.... I just hope the FBI really has a case, not like with Katrina.”

“Katrina” is Katrina Leung, the prominent Chinese American activist and businesswoman who was charged with being a double agent for the Chinese government. But a federal judge ended up dropping all charges against her.

Yang said she was relieved that the case turned out not to be as far-reaching as some initial reports suggested. But she is also disappointed.

“I’m sad for the FBI and for what the government prosecutors have done to these Chinese Americans,” she said. “I’m sad because you make other people think you abuse the power.”

Cat Chao, 39, who is host of a Mandarin-language talk show at evening rush hour, plans to talk about the most recent spy case tonight.

She said many in the community talk about any news of Chinese American espionage with a heavy dose of sarcasm.

“It’s a cultural thing to always believe authority -- whatever teacher says is always right,” Chao said. “Then we found out Wen Ho Lee is totally innocent. It was humiliating for our Chinese community and Taiwanese community.”

Wen Ho Lee, a Los Alamos National Laboratory scientist, was accused of stealing nuclear secrets for China in 1999. Lee later pleaded guilty to a lesser charge of mishandling classified computer files but not spying. The Lee case became something of a rallying cry for many Chinese Americans who felt he was unfairly treated by the government.

The latest spying case shocked some in the Chinese American community because the defendants seemed to have long-standing ties in Southern California. The FBI originally alleged in an affidavit that Chi Mak, a lead project engineer on a contract to develop a quiet electric-drive propulsion system for U.S. Navy submarines, transferred information about the system to his home computer.

The affidavit alleged that his wife helped him copy the information onto CDs and then Tai Mak, a broadcast and engineering director for a Chinese cable network, and Fuk planned to take the information to China.

The charges were changed for a number of reasons, some of which cannot yet be divulged, said Thom Mrozek, a spokesman for the U.S. attorney’s office in Los Angeles.

Even if the information copied was only sensitive, not classified, Mrozek said, transmitting sensitive information is inappropriate.

While some of the information on the submarine propulsion system might have been discussed at a conference, discussing this kind of information with military applications at a meeting of American scientists is not the same as handing it over to foreign power, he said.

“These are serious charges they’ve been indicted on,” Mrozek said. “You have people you believe are intelligence operatives for another country and taking information of a military contractor to another country. Should we let them go with it?”

He said that some of the evidence the FBI had presented in the original charges showed that the three people were working for China. Federal agents who searched Chi Mak’s trash found a document written in Chinese that “lists a number of military technologies that were sought.”

The federal government has had some success in prosecuting Chinese Americans on charges of spying for China.

In 1997, a Manhattan Beach physicist pleaded guilty to revealing classified information about lasers and radar while giving lectures to scientists in China. More recently, four naturalized U.S. citizens pleaded guilty in New Jersey in September to shipping military grade circuits to research institutes controlled by the Chinese government.

The Lee and Leung cases are often cited by critics who say the U.S. government has overreached in some of its China spy investigations.

Criticism of the government’s handling of such cases is far from universal. Some Chinese American activists who have long spoken out against the Communist government said the FBI was right to be concerned about spying.

David Ma, a 65-year-old international business consultant who lives in Alhambra, said he could understand why the FBI moved quickly in this case.

“I’m not saying they’re doing a bad job,” Ma said. “It’s incomplete. They were in the midst of an investigation and these people tried to leave the country. What if they don’t come back?”

But beyond the question of how the FBI has handled this investigation, Ma added that the string of cases also highlighted the tricky balancing act many Chinese Americans had to do when dealing with China.

Ma believes that as China’s economy continues to boom, there are growing temptations for Chinese nationals who want to do business there to help the government any way it can.

“I’m not saying all of them are spies,” he said. “But for some of them it is outright greed because they need to do business with [the Chinese government]. It’s just like barter or exchange.”

George Bao, a 55-year-old reporter for the Chinese Daily News who has been covering the latest spy scandal, said some of his readers had commented generally on the growing temptation locally to cash in on the China boom.

“In China now, money is everything,” he said.

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Times staff writer David Pierson contributed to this report.