The federal dragnet is so massive that investigators have given the case the code name "Lurking Giants."
This sweeping investigation into academia concerns not Hollywood celebrities who paid tens of thousands of dollars to secure college admission for their kids, but hundreds of millions of dollars that have poured into the country's most prestigious universities as gifts and contracts—unreported—largely from governments hostile to the U.S. The alleged theft of American taxpayer-funded military and scientific research would be a violation of the federal Higher Education Act. A recent Congressional report called the practice a threat to homeland security.
Federal law enforcement sources tell Newsweek that last month's arrest of Charles Lieber, the Chair of Harvard University's Chemistry and Chemical Biology Department, is just "the first domino to fall."
Federal investigations are targeting "multiple scientists and researchers" at leading universities who have allegedly been enriching their bank accounts by endangering intellectual property paid for by grant monies from the U.S. Department of Defense and National Institutes of Health, several sources told Newsweek.
Lieber was one of those scientists whom federal prosecutors have identified as allegedly putting U.S. secrets at risk by double dealing: collecting $15 million in DOD and NIH grants for his work as a Harvard professor while simultaneously working as a Thousand Talents Program researcher for Beijing. Lieber was grilled about his work for the Chinese earlier this year by both federal investigators and Harvard officials and provided what the FBI called a "series of materially false, fictitious and fraudulent" statements.
Prosecutors say Lieber created a bank account in China to hide the $50,000 monthly stipend he was getting from the Chinese—a violation of his contract with the DOD and with Harvard—and the $158,000 he received for living expenses connected to his travel to the shadow lab he created at the Wuhan University of Technology.
Lieber, who grows bioengineered giant pumpkins in the yard of his home in Lexington, Mass., which is now part of a $1 million cash bail package he signed over to the court to secure his release from a federal lockup, is facing up to five years in prison. He and his wife Jennifer were ordered to surrender their passports. He has retained former Assistant United States Attorney Peter Levitt, who specializes in white-collar criminal defense, to represent him. Levitt declined to comment.
Academic institutions are now anxiously waiting for the next shoes to drop. Other universities, including the Massachusetts Institute of Technology, are securing legal teams to mitigate the expected fallout from what Massachusetts U.S. Attorney Andrew Lelling told Newsweek is "additional enforcement" aimed at rooting out academic espionage.
"Through the use of not only traditional intelligence officers, but academics, researchers, and other private citizens, China is engaged in a massive, long-term campaign to steal U.S. research and technology for its own uses," Lelling said. "[The Boston area] is an especially attractive target for this kind of exploitation."
Institutions are required to report any foreign gifts over $250,000 under the Higher Education Act. But in recent months ten schools -- Cornell University, Yale University, the University of Colorado Boulder, the University of Texas MD Anderson Cancer Center, the Massachusetts Institute of Technology, the University of Chicago, the University of Pennsylvania, Boston University, Texas A&M University, and Carnegie Mellon University -- were found to have taken more than $3.6 billion in foreign gifts, and have since filed the paperwork required under federal law, the Department of Education said. The DOE has ongoing investigations into monies that poured into Harvard and Yale.
In a Feb. 11 letter, Reed Rubinstein, the DOE's principal deputy general counsel, accused Yale President Peter Salovey in a letter of not reporting "a single foreign source gift or contract" from 2014 to 2017. In a letter to Harvard President Lawrence Bacow, Rubinstein said the Department of Education had information that his university "lacks appropriate institutional controls." In 2019 MIT, Cornell, Georgetown, Rutgers, and Texas A&M were also told by the DOE that they were being targeted for being in violation of disclosure law.
A Yale spokeswoman said the university's "oversight" did lead to a four-year gap in the mandated reporting of foreign funding, which the university says has since been rectified. "Yale takes very seriously the importance of ensuring that funding from foreign sources does not in any way compromise American interests, and it respects the Education Department's requirements about reporting of such funding," Karen Peart said in response to a Newsweek inquiry. Yale does not conduct classified research, Peart said. A Harvard spokesman said the university is reviewing the DOE letter and "preparing its response," but would not comment beyond that.
MIT's hiring of a Boston law firm came after one of its biology professors, Jianzhu Chen, was questioned by immigration officials at Boston's Logan Airport after returning from China in May. He said he was asked, "Do you work for a foreign government?" and grilled about his travel to China and a trip to Russia. After the incident Chen remarked, "That's no way to catch a spy," a source close to the researcher told Newsweek.
Weeks after Chen was questioned, MIT President Rafael Reif posted an open letter to the university community that raised questions about whether Chinese scientists were being unfairly targeted by federal investigators. "I am well aware of the risks of academic espionage and MIT has established prudent policies to protect against such a toxic atmosphere of unfounded suspicion and fear."
Reif warned of "serious long-term costs to the nation and MIT."
MIT spokeswoman Sarah Donnelly would not comment to Newsweek on any ongoing federal investigations. She did tell Newsweek: "MIT takes its federal reporting obligations seriously. Over a year ago, MIT identified ways to improve its foreign gift and contract reporting. The Institute is committed to working constructively with federal officials."
The fear of academic espionage is nothing new. In 2018, the DOJ created a federal task force of U.S. Attorneys in Texas, New York, California and Alabama. Known as the "China Initiative," its goal is to root out "foreign agents seeking to influence the American public and policymakers." The primary goal is to identify Chinese military officers embedded in academia, such as two researchers who are currently under indictment in Boston.
On the same day that Lieber was arrested, Lelling's office unsealed a federal indictment against Yanqing Ye, a grad student at Boston University's Department of Physics, Chemistry, and Biomedical Engineering, charging her with visa fraud. Federal prosecutors said Ye hid her position as a top lieutenant of China's People's Liberation Army on immigration forms to facilitate her work conducting "numerous assignments for the PLA," including "assessing US military websites, researched US military projects, and compiled information for the PLA on two US persons with expertise in robotics and computer science." She was, prosecutors believe, an embedded Chinese spy—a military intelligence officer moving within the Boston University system and funneling military secrets back to her PLA handlers.
Ye is now being sought by the FBI. She is believed to have fled to China.
In December, another researcher whose visa was sponsored by Harvard University, Zaosong Zheng, was arrested at Boston's Logan Airport for allegedly stealing 21 vials of biological materials from Beth Israel Deaconess Medical Center, wrapping them in his socks, and trying to smuggle them to China in his checked baggage. On Feb. 28, a federal judge issued a protective order for "sensitive government discovery materials" in Zheng's case. U.S .District Court Magistrate David Hennessy wrote in the ruling: "restrictions are necessary to protect the confidentiality of proprietary business information." Zheng has been held without bail since his arrest in December.
Meanwhile, law firms are fielding calls from concerned university heads and academics.
"Scientists who interact with China, especially in the Boston area and the academic world, are justifiably anxious as to where these ongoing probes will lead," said lawyer Brian Kelly, a partner at Nixon Peabody in Boston.
Kelly, a former assistant U.S. Attorney who was one of the prosecutors in the 2013 murder trial of Boston gangster James "Whitey" Bulger, agreed that Lieber's arrest will not be the last.
"The government is intensifying these investigations into economic espionage cases," Kelly said, and his former colleagues are unlikely to "limit those probes to one particular school."
There are federal prosecutions of academics ongoing across the country.
A UCLA grad student studying electrical engineering was caught trying to smuggle apparatus for war missile guidance. A Chinese student at the Chicago Institute of Technology was charged with helping his country recruit new spies at his school. A chemistry professor at the University of Kansas was charged with duping the U.S. by taking grants for research he had already completed in China.
The arrests have raised concerns about ethnic targeting.
In late February, two Democratic lawmakers who work on civil rights issues, Reps. Jamie Raskin of Maryland and California Congresswoman Judy Chu, sent a letter to the FBI demanding answers on whether Chinese researchers are being ethnically victimized. They wrote: "certainly there are authentic and legitimate cases of espionage that should be investigated," but they pointed to cases where Chinese researchers were arrested only to have the cases against them dropped."
Chu has been outspoken about the China Initiative since its inception, saying that the ongoing investigations have the potential "to paint all Chinese students, scholars, and employees en masse as potential spies for China."