Tuesday, November 29, 2005

A defense contractor charged with failing to register as a Chinese agent admitted passing data on U.S. Navy arms technology to China for 22 years, including information on next-generation destroyers, an aircraft carrier catapult and the Aegis weapons system, according to new court papers in the case.

Two federal judges in Los Angeles on Monday reversed earlier rulings and ordered the contractor and his brother held without bond. The rulings followed testimony from FBI agents in the case.

Court papers released Monday, including a detention motion filed by Assistant U.S. Attorney Gregory Staples, also identified the Chinese military intelligence handler who received the information from defense contractor Chi Mak and his brother Tai Mak, who also is in the Chinese military.

The court documents shed new light on what U.S. intelligence officials say will be one of the most damaging cases of Chinese technology spying on U.S. weapons, even though the information compromised was not secret.

According to court papers, Chi Mak, an electrical engineer who worked on more than 200 Navy contracts, told investigators two days after his Oct. 30 arrest that he had been sending sensitive but unclassified documents on weapons research to China since 1983.

According to the papers, Chi Mak admitted passing to China information on:

• Direct current-to-direct current (DDC) converters for submarines.

• A 5,000-amp direct current hybrid circuit breaker for submarines.

• Electro-Magnetic Aircraft Launch System (EMALS), a new system to launch aircraft from carriers using magnets instead of steam.

• The power distribution system for the Aegis weapons system and its Spy-1 radar, used on the Navy’s most advanced guided missile destroyers and cruisers.

• A study that reveals the methods used by U.S. warship personnel to continue operating after being attacked. Officials said the paper is a blueprint for attacking and disabling warships.

• Modifications and Additions to Reactor Facility (MARF), a nuclear reactor located at the Navy’s Knolls Atomic Power Laboratory that’s used for testing prototype nuclear reactors. Investigators found a detailed, hand-drawn map of that facility in Chi Mak’s house.

Prosecutors argued in court that Chi Mak planned to retire to China in March and thus posed a flight risk.

U.S. District Judge Cormac J. Carney, who ordered Chi Mak to be held without bond, dismissed a defense lawyer’s claim that the charges were exaggerated. “You’re talking about billions of dollars of technology that puts our country at serious risk,” he said.

Investigators found data on the DDX destroyer program on encrypted files carried by Tai Mak, a Phoenix television engineer, when he was arrested along with his wife Oct. 28 at Los Angeles International Airport as they prepared to travel to China. The documents were labeled “proprietary” and “restricted,” the court papers stated.

Chi Mak and his wife also were arrested Oct. 28 and initially charged with theft of government property and conspiracy. The charges against Chi Mak, his wife and Tai Mak were later reduced to failing to register as government agents. Tai Mak’s wife was charged in a separate indictment with running a marriage fraud business.

According to the papers, Chi Mak, who was recently fired from his defense contractor job at Power Paragon, initially traveled to Hong Kong and gave the stolen information to his brother. Tai Mak then passed it to Pu Pei-Liang, identified by the FBI and the Naval Criminal Investigative Service (NCIS) as a research fellow at the Center for Asia Pacific Studies (CAPS) at Zhongshan University in Guangzhou, China. Later, Tai Mak served as the courier for the data.

During an intercepted telephone call to Mr. Pu on Oct. 19, Chi Mak stated he was part of the “Red Flower of North America,” the code name that the FBI thinks was used to identify the spy ring.

The NCIS said the center in Guangzhou is run by the Chinese military and conducts operational research for it, including acquiring U.S. Navy technology.

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