A Chinese national pleaded guilty on Jan. 6 to conspiracy to commit economic espionage after he tried to steal a trade secret from his U.S. employer to advance his career at a Chinese state-run research institute.
Haitao Xiang, 44, a legal permanent U.S. resident formerly from Missouri, worked for Monsanto, a St. Louis-based agrochemical and agricultural biotechnology company, and its subsidiary, The Climate Corporation, between 2008 and 2017, according to the Department of Justice (DOJ).
He tried to steal an algorithm that was a crucial component of an online farming software platform developed by Monsanto, DOJ officials said. The platform allowed farmers to collect, store, and visualize critical agricultural field data and increase and improve agricultural productivity for farmers.
The algorithm, named the Nutrient Optimizer, which Xiang worked on during his employment as an image scientist, was considered by Monsanto and The Climate to be a valuable trade secret and their intellectual property, according to the DOJ.
“Mr. Xiang used his insider status at a major international company to steal valuable trade secrets for use in his native China,” said U.S. Attorney Sayler Fleming for the Eastern District of Missouri, according to a DOJ statement.
Fleming added: “These crimes present a danger to the U.S. economy and jeopardize our nation’s leadership in innovation and our national security.”
Beginning in around June 2015, Xiang began communicating with individuals working for the Chinese regime, about possible employment at China’s state-run Chinese Academy of Science’s (CAS) Institute of Soil Science, according to a court document. He also inquired about being recruited under China’s state-run talent recruitment program known as the “Thousand Talents Plan.”
That program is just one of many similar talent recruitment programs that the Chinese regime offers, in order to attract overseas Chinese and foreign experts into working in China’s science and tech sectors. Through these programs, Beijing hopes to quickly turn China into an industrial and innovation powerhouse, ultimately to outperform Western countries.
Other similar programs include the National Science Fund for Distinguished Young Scholars. All of these programs often offer hefty financial incentives; including salaries, housing, and relocation costs.
“Through its talent recruitment programs, like the so-called Thousand Talents Plan, the Chinese government tries to entice scientists to secretly bring our knowledge and innovation back to China—even if that means stealing proprietary information or violating our export controls and conflict-of-interest rules,” Wray said.
Xiang informed recruiters for China’s talent programs about his skills that came with working with Monsanto’s online farming software platform and the Nutrient Optimizer, according to the court document.
U.S. prosecutors said Xiang was hired as a “Hundred Talent Program” recruit for CAS’s Institute of Soil Science in August 2016.
Less than a year later, in May 2017, Xiang informed his employer about his intention to resign, according to the court document.
A month later, after leaving his employment, Xiang tried to fly to China after purchasing a one-way plane ticket. Before he could board the plane, he was stopped and searched by federal officials, and they found his electronic devices containing copies of the Nutrient Optimizer.
According to the DOJ, Xiang was allowed to continue his flight to China but was arrested when he returned to the United States.
Xiang was indicted in November 2019.
“The American worker suffers when adversaries, like the Government of China, steal technology to grow their economies,” said Assistant Director Alan E. Kohler Jr. of the FBI’s Counterintelligence Division, according to the statement.
Xiang is scheduled to be sentenced on April 7, the DOJ announced, when he faces a maximum penalty of 15 years in prison and a possible fine of $5 million.
The DOJ has prosecuted many researchers for hiding their participation in China’s talent programs. One of the most recent cases involved Charles Lieber, a Harvard University professor, who was convicted on six felony charges in December last year for lying about his ties to the Thousand Talents Plan.
Liber concealed his income from the program, including $50,000 per month plus $158,000 in living expenses and more than $1.5 million in grants from a Chinese university, according to prosecutors.