China is a bigger espionage threat than any other country, including Russia, and the FBI has more than 1,000 active investigations into intellectual property theft cases leading back to the Beijing government, bureau Director Christopher Wray said Tuesday.
He called the threat “deep and diverse and wide and vexing,” said it affects everything from aerospace to agriculture, and said tactics range from computer hacking to coopting corporate insiders.
One particular weak point, he said, is the American higher education system, which he said has become a “pipeline” for intellectual property to flow back to China, advancing that country’s economic goals.
“We have to be a little bit careful we don’t find ourselves in a situation where U.S. taxpayer money is being misappropriated for the advancement of China’s achievement of economic dominance over us,” he told the Senate Judiciary Committee.
China has long denied U.S. allegations of intellectual-property theft targeting American businesses and government-funded research. Instead, China has insisted the accusations are a “political tool” wielded by President Trump as part of the two countries’ trade war.
But a slew of indictments and other actions in recent months by the Justice Department tell a different story.
The FBI earlier this month added Xudong Yao, a 57-year-old software engineer, to its wanted lists. U.S. authorities say he fled to China with the propriety source code for a locomotive control system developed by a suburban Chicago company.
Half of the 16 names on the FBI’s counterintelligence most wanted list are Chinese suspects charged with theft of intellectual property or trade secrets for Beijing’s benefit.
Mr. Wray’s testimony came a day before former special counsel Robert Mueller is slated to testify about his work on Russian election-meddling and President Trump’s campaign.
Though FBI agents staffed Mr. Mueller’s team, Mr. Wray batted aside questions about their work.
But he did say Russia is determined to meddle again, and the FBI has dedicated “significant resources” to trying to stop them.
Sen. Lindsey Graham, South Carolina Republican and the panel chairman, wondered whether it was working.
“Everything we’ve done against Russia has not deterred them enough?” he said. “All the sanctions, all the talk, they’re still at it?”
“Yes. My view is until they stop, they haven’t been deterred enough,” Mr. Wray responded.
The FBI director also expressed his support for paper ballots, saying such backup measures would help against attempts to hack election results.
Mr. Wray also offered a vigorous defense of the bureau’s handling of a background check into Supreme Court Justice Brett M. Kavanaugh insisting his agents followed proper procedures.
Sen. Sheldon Whitehouse, Rhode Island Democrat, criticized how the probe was managed, saying the FBI ignored leads and declined to speak to witnesses. The investigation was reopened last fall after sexual-assault accusations were lodged against Justice Kavanaugh weeks before his confirmation hearing.
But Mr. Wray insisted the probe was managed correctly.
“I consulted at length with our security professionals who are specialists in background investigations to make sure that the investigation was done consistent with our long-standing policies, practices and procedures,” he said in testimony before the Senate Judiciary Committee.
Mr. Whitehouse continued to press the issue claiming the FBI did not follow up on accusations left on a tip line it created as part of the probe. Mr. Wray countered that the bureau was operating a background check, not a criminal probe in which more witnesses would be interviewed.
“I think it’s important for people to understand there is a fundamental difference between a background investigation and the kinds of criminal investigations or even counterintelligence investigations the FBI does every day,” he said.