Federal authorities have arrested two Chinese nationals, including a permanent U.S. resident, in connection with an alleged espionage plot aimed at stealing American military secrets for the Chinese government.
According to the Department of Justice (DOJ), the two men were involved in passing classified U.S. Navy information to China’s Ministry of State Security (MSS) in exchange for large cash payments. The pair reportedly used covert methods such as “dead drops” to deliver intelligence and receive thousands of dollars in return.
The suspects — Yuance Chen, a Chinese national and lawful permanent U.S. resident based in Oregon, and Liren Lai, another Chinese national — were taken into custody on June 27, 2025. They are accused of acting on behalf of the People’s Republic of China without properly notifying the U.S. Attorney General, as required by law.
Investigators say the men began collaborating as early as January 2022. Their efforts included identifying individuals within the U.S. Navy who might be open to recruitment by Chinese intelligence. The DOJ revealed that the two obtained and shared photos of a bulletin board listing the names, programs, and hometowns of Navy recruits — many of whom were of Chinese descent — with an MSS operative overseas.
Further allegations detail how Chen and Lai were guided by Chinese intelligence officers on how to further their recruitment network. Chen is said to have traveled to China to coordinate directly with MSS agents, discussing payment and receiving instructions for future operations.
In a July 1 press release, U.S. Attorney General Pam Bondi described the arrests as a stark reminder of China’s persistent efforts to undermine American national security. “This case exposes the Chinese government’s aggressive strategy to infiltrate our military and gather critical intelligence,” she said. “We will not allow hostile regimes to plant operatives in our country unchecked.”
FBI Director Kash Patel noted that the suspects were not only passing sensitive information but actively attempting to recruit others within the U.S. military. “This was a deliberate and calculated espionage effort,” Patel stated. “They relied on traditional spycraft, such as dead drops, and believed they could evade detection on American soil.”
Director Patel credited multiple FBI field offices — including those in San Francisco, Portland, Houston, and San Diego — along with the agency’s Counterintelligence Division, for their coordinated work in dismantling the operation. “Our agency will remain relentless in countering China’s extensive attempts to penetrate U.S. defenses,” he added.
Assistant Attorney General for National Security John Eisenberg echoed those concerns, emphasizing the long-term strategies used by foreign intelligence agencies like the MSS. “These adversaries spend years grooming assets within our borders,” Eisenberg said. “Our mission remains clear: to disrupt and dismantle these covert networks before they can do lasting harm.”
