Tao is accused of failing to disclose ties to a Chinese university while employed in Kansas. His prosecution is part of the China Initiative, a sweeping effort by the Department of Justice, the FBI and other federal agencies launched in November 2018.

One primary goal was to counter Chinese espionage in America’s corporations and research labs by rooting out spies and halting the transfer of information and technology to China.

The FBI says it has opened thousands of investigations involving China since then. But recent setbacks – six cases dropped last July and a directed acquittal in September – have revealed law enforcement errors and prosecutorial overzealousness.

Advocacy groups say the prosecutions reflect racial bias, fuelled by tensions with China, that contributed to a 71 per cent rise in incidents of violence against Asian-Americans from 2019 to 2020. United States Attorney General Merrick Garland has pledged to review the programme.

“They have turned the China Initiative into an instrument for racial profiling,” says Judy Chu, a Democratic representative from California who is the first Chinese-American woman elected to Congress. “They have turned it into a means to terrorise Chinese scientists and engineers. Something has gone dramatically wrong.”

A Bloomberg News analysis of the 50 indictments announced or unsealed since the start of the programme and posted on the Justice Department’s China Initiative webpage reveals a further problem: the China Initiative has not been very successful at catching spies. The largest group of cases, 38 per cent of the total, have charged academic researchers and professors with fraud for failing to disclose affiliations with Chinese universities.

None of them has been accused of spying, and almost half of those cases have been dropped. About half as many China Initiative cases concern violations of US sanctions or illegal exports, and a smaller percentage involve cyber intrusions that prosecutors attributed to China. Only 20 per cent of the cases allege economic espionage, and most of those are unresolved. Just three claim that secrets were handed over to Chinese agents.

The Justice Department declined to comment on the analysis, saying there is no definition of what a China Initiative case is. It removed several unsuccessful prosecutions from the website last November. But Wyn Hornbuckle, a Justice Department spokesman, cited what he called significant successes prosecuting crimes tied to China. He said in an email that the department brings cases based on conduct, not ethnicity.

China has long had aspirations to move up the science and technology innovation ladder, and it has often taken short cuts to do so. Its methods, documented in court cases predating the China Initiative, have included state-directed espionage, hacking and technology theft.

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Prosecutors have unveiled foiled technology transfers involving semiconductors, modified rice seeds, turbines and battery storage. A case against Chinese telecoms giant Huawei Technologies accuses it of stealing robot technology from T-Mobile US, allegations the company has denied.

“China wants the fruits of America’s brainpower to harvest the seeds of its planned economic dominance,” John Demers, then head of the Justice Department’s national security division that oversees the China Initiative, said when the programme was announced. He told US media company Politico in April 2020 that each of the 93 US attorneys’ offices was expected to come up with at least one case.

But most economic espionage cases listed on the China Initiative website, the Bloomberg analysis shows, involve accusations of profiteering or career advancement by individuals – such as the alleged stealing of technology for a paediatric diagnostic kit from an Ohio hospital to set up a company in China – rather than state-directed spying.

Many of these indictments portray the thefts as being for the benefit of China, what Seton Hall University law professor Margaret Lewis calls a conflation of individual motives with a country’s policy goals. That has led to the criminalisation of “China-ness”, she says.

“When you label something China Initiative, the way our brains work, we know that will turn our attention to people who have connections,” she says. “How could you not see people connected to China as part of a threat?”

The first China Initiative indictment of a professor came less than a year after the programme was announced, on August 21, 2019. It was Franklin Tao.

“We came here to pursue the American dream,” says Hong Peng, 45, sitting in a hotel restaurant, digging into the pocket of her denim jacket for a tissue. Peng, Tao’s wife, is wearing her long hair in a girlish ponytail. A naturalised US citizen, the mother of two high-school-age children, and an evangelical Christian, she is an ultrasound technician working three jobs since her husband lost his.

On the eve of Tao’s October pre-trial hearing, Peng is lamenting the family’s now-precarious financial position. It is hard for her not to cry. Her GoFundMe campaign raised US$320,000, but there is no money left. She and her husband had to pledge their house in exchange for bail and to borrow hundreds of thousands of dollars from family in China and members of their church in Kansas, to pay legal fees.

Peng was a radiologist in China, but she has not been able to take her medical boards in the US and fears she never will. Running from shift to shift at three hospitals, catching naps in her car, leaves her ragged. “It’s just unfair,” she says through tears. “He didn’t do anything wrong.”

Tao, 50, is a Princeton-educated scientist who came to the US almost 20 years ago. As a tenured associate professor at the University of Kansas, he did research into a type of chemical process called catalysis, which can reduce energy consumption and cost, receiving grants from the US Department of Energy and the National Science Foundation.

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In 2019, Tao got into a dispute with a co-author of a research paper who didn’t think she was being given sufficient credit and demanded US$310,000, citing what she called “spiritual hurts”, according to documents filed in the case. When Tao rebuffed her, she replied in an email that “my counter-attack will be very strong and very extreme” and warned that she would report him to the FBI as a “tech spy”.

The documents also show that the co-author, who isn’t identified by name, used fake email accounts to levy the accusations and hacked into Tao’s email, even during a meeting with FBI agents. The FBI used that information to obtain a search warrant – evidence of what Zeidenberg calls agency misconduct and the results of which he wants to have ruled inadmissible.

The co-author’s spying accusations didn’t stick, but Tao was charged with failing to disclose in conflict-of-interest filings his recruitment discussions with China’s Fuzhou University. The FBI search found emails between Tao and the university that the prosecution says contain a contract to teach in China.

04:26

Chinese-American scientists fear US racial profiling

Chinese-American scientists fear US racial profiling

The defence says Tao was only in job discussions, didn’t sign the contract or take the job, and continued his teaching duties in Kansas, which didn’t constitute a violation of disclosure rules. Tao pleaded not guilty to the charges.

Lawyers for academics who have been charged in China Initiative cases have argued that disclosure rules for universities and for receiving federal research funding aren’t clear. They also maintain that collaboration is a cornerstone of scientific innovation, that the research is intended for publication, and that US universities had long encouraged their faculty to develop links with China.

Anming Hu, another professor charged with fraud, was told by the University of Tennessee that he only had to disclose income from lectures in China in excess of US$10,000, according to court documents. He earned US$3,000 but was indicted anyway. In September 2021, a federal judge ordered an acquittal in the case after concluding there was no evidence of fraud.

He also chided the FBI for telling the university it was pursuing Hu as a spy, when it knew that wasn’t the case. He was offered his job back in October 2021, and a university spokeswoman says officials are working with the naturalised Canadian citizen to secure a work visa.

In one of the cases dropped in July 2021, involving a researcher charged with visa fraud, the FBI had failed to disclose evidence of disagreement within the bureau over whether researchers should be held accountable because the disclosure requirement “lacks clarity”.

Concern that Chinese universities paying US researchers could incentivise future technology transfers is what led to the indictment of Harvard University nanoscientist Charles Lieber, says Andrew Lelling, the former US attorney in Boston who brought the indictment and helped develop the China Initiative.

At his criminal trial in December 2021, Lieber, who allegedly received US$50,000 a month, US$158,000 in living expenses, and US$1.5 million to establish a lab at Wuhan University of Technology, was found guilty of failing to disclose the arrangements to the National Institutes of Health and the Department of Defence, which had funded his Harvard research.

When the China Initiative was rolled out, the second of its 10 stated goals was to implement an “enforcement strategy concerning nontraditional collectors”, including researchers who are “being co-opted into transferring technology contrary to US interests”.

That supposition exaggerates the threat and misunderstands the nature of scientific cooperation, says David Zweig, a professor emeritus at the Hong Kong University of Science and Technology and an authority on China’s talent migration.

Yes, China has used talent programmes to attract US-based professors for lectures and research, Zweig says. And Chinese students work in US research labs with the expectation they will return to China. “It is not the transfer of knowledge that became the issue but the partner, China, who is now seen by the US government as a strategic competitor.”

John Hemann, a former deputy US attorney in San Francisco who prosecuted the first announced China Initiative case and later, in private practice, defended a medical researcher charged with visa fraud, says the programme has “gone off the rails”. His client, Chen Song, a neurologist from a Beijing hospital working on a brain study at Stanford University, was charged with misrepresenting whether she still served in the People’s Liberation Army.

Her case was among those dropped in July 2021. “It’s morphed into something that’s completely away from what the point of what this exercise was in the first place,” Hemann says. “It’s a political problem and an economic problem, not a problem to be solved by criminal prosecutions.”

Nathan Charles, another former prosecutor, counters that the federal cases didn’t go far enough. Now he is in private practice, and his website advertises an “ultra-aggressive” approach. The 42-year-old former Navy Seal was working as a prosecutor in the counter-espionage section of the Justice Department’s national security division when the China Initiative began.

He attended meetings at the White House to develop a coordinated strategy and says he advocated a hard line. He worked on the Franklin Tao and Anming Hu indictments, arguing they should be charged with being agents of a foreign government under the Espionage Act of 1917. He was overruled.

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“From my perspective, the Justice Department wasn’t being nearly aggressive enough in their prosecutions,” Charles says from behind a desk in a shared co-working office space in Rockville, Maryland, just outside Washington. A lot of prosecutors and law enforcement officials favoured using the 1917 law to get “at what’s going on”, he says.

That is because China’s Ministry of Education provides universities with the direction and priorities that are then acted on by professors coming from the US to lecture or do research, he says: “It’s the Chinese Communist Party that has set the research goals and priorities of the universities. The goal is to advance the interests of the Chinese Communist Party. Period.”

In both the Tao and Hu cases, their research in chemistry and hi-tech welding techniques touched on areas that the Chinese government has said it wants to develop, and their potential use in the energy industry turns them into national security issues, Charles says.

He says he pushed to have China and the Chinese Communist Party also named in the indictments as parties to the fraud, but that didn’t happen. “A lot of other things are going on, but because of the way we charge the case, none of those other things are coming to light.”

It’s a similarly blurred line between the party, state and private enterprise in the economic espionage cases, says Lelling, the former US attorney who is now a partner at American law firm Jones Day. “A lot of the cases are for personal gain, but on the China side, there isn’t the bright line between the public and the private sector,” he says. “Under Chinese law, the government may be able to take what it wants from a private entity based in China.”

The reason there are more cases alleging disclosure gaps than ones involving theft of trade secrets, Lelling says, is that espionage cases take longer to investigate. Still, he says, the government should consider pulling back on charging researchers for not disclosing ties with China because the point has been made.

“Prosecution is one of the sharpest knives in the drawer for dealing with it,” Lelling says. “One of the questions I always ask is, is this too much? Is this proportional? You cannot appropriately respond to China by just prosecuting people. You can’t do nuanced foreign policy by just using the Justice Department.”

In a LinkedIn post on December 3, 2021, Lelling called for shutting down parts of the programme “to avoid needlessly chilling scientific and business collaborations with Chinese partners”.

Asian-American advocacy groups say those sharp knives have opened a new chapter in a shameful history that includes Chinese exclusion laws, the internment of Japanese-Americans during World War II, and depictions of Chinese as a “thousand grains of sand” in the failed 1990s prosecution of Li Wenho for allegedly stealing nuclear secrets from the Los Alamos National Laboratory in New Mexico.

The term “non-traditional collectors” to describe researchers with links to China is the latest way of labelling Asian-Americans as perpetual foreigners in what the Committee of 100, a Chinese-American advocacy group, calls “the new Red Scare”. The organisation published a report in September 2021 based on a review of 190 economic espionage cases brought since 1996. It showed that defendants with Asian surnames were more than twice as likely to be falsely accused and, if convicted, faced harsher punishment.

When the US drove out hundreds of scientists and students believed to be communist sympathisers in the previous Red Scare of the 1940s and 50s, one of those who returned to China, Qian Xuesen, became the father of that country’s nuclear missile programme. Now, a new chill is sending hundreds of researchers back to China and deterring countless others from going to the US.

One who has left is Qing Wang, a fifty-something medical researcher whose pioneering work identified genes for heart arrhythmia that causes sudden death in young adults. A naturalised US citizen since 2005, Wang worked at the Cleveland Clinic for 21 years. Then, one morning in May 2020, FBI agents arrested him at his home in a suburb of Cleveland.

He was charged with fraud for failing to disclose his research in China. His case was listed on the Justice Department’s China Initiative website, then removed in July 2021 when the charges were dropped after he produced a letter from the hospital giving him written authorisation to teach in China.

“I’m a victim of this China Initiative,” says Wang in a Zoom interview from China, where he has been living since September 2021. “It’s not fair. It is racial profiling.”

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Wang, who left behind his wife and two college-age daughters, says he just wants his career back. But the Cleveland Clinic has not offered to reinstate him or to apologise – a spokeswoman for the hospital says Wang was fired following an internal review that found he violated its policies – and he is in discussions with five Chinese universities for a full-time teaching job.

Wang says the FBI and prosecutors don’t understand that researchers like him publish their work openly in scholarly journals and don’t keep any secrets, let alone transfer them. There’s no small irony here, he says: the US, seeking to stop such people from transferring their knowledge and research to China, has driven some of those very people back to China.

The FBI says there is nothing racially motivated about its China Initiative investigations. Agents are simply pursuing possible criminal activity that poses a risk to national security without regard to race, ethnicity or national origin, a bureau spokesman said in an email.

“Stolen research, network intrusions, covert operations – these are some of the ways the Chinese government threatens the economic well-being, national security and democratic values of the United States,” a narrator intones on an FBI podcast from October 12, 2021.

Then, repeating a line from a speech by FBI director Christopher Wray, he says: “Let’s be clear: This is not about the Chinese people, and this is certainly not about Chinese-Americans. When we speak of the threat from China, we mean the threat posed by the government of China and the Chinese Communist Party.”

More than 1,600 scholars and administrators from more than 200 universities have petitioned Attorney General Garland to end the China Initiative, saying it disproportionately targets researchers of Chinese origin. During an appearance before the US House Committee on the Judiciary last October, Garland said there’s no excuse for discrimination, though he confirmed that new investigations were being opened daily.

“I can assure you that cases will not be pursued based on discrimination, but only on facts justifying them,” he pledged. He told the committee that Matthew Olsen, the new head of the department’s national security division, would review the programme.

That is of little consolation for Tao, whose trial is scheduled to begin in April. At last October’s hearing in Kansas City, Judge Julie Robinson ruled the evidence obtained by the search warrant admissible, despite what she called FBI omissions about its “unreliable informant”.

Unlike his wife, Tao never applied for US citizenship. His mother in Chongqing was ill, and he didn’t want to have to apply for a visa if he needed to travel to see her. But for a green card holder like him, a felony conviction could mean deportation.

A half-dozen members of the couple’s evangelical church were in court to show their support. They sat with Peng in a spectators’ row. During a break, after Zeidenberg lost another motion, a pastor placed his hands on her shaking shoulders and prayed.

At the end of the day, on the way out of the building, Zeidenberg turned to Tao with words appropriate not only for the day’s losses but also perhaps for the whole ordeal: “I’m sorry.”