A Chinese national has been extradited to the US and arrested as part of a Federal criminal investigation of the theft of trade secrets held by aerospace manufacturer GE Aviation in Ohio.

Yanjun Xu was indicted by a US grand jury and arrested in Belgium, and later extradited to the US. In the federal indictment, Xu is identified as an officer in the Chinese Ministry of State Security (MSS). The indictment names one other unindicted co-conspirator, and at least one GE Aviation engineer, identified only as “Employee #1,” as being part of a conspiracy to steal information regarding the materials used by GE in building its fan blades. The GE engineer has apparently not yet been arrested, but may have been working with Federal investigators undercover.

The indictment refers to GE Aviation only as “Victim Company A,” but was then identified as GE by company officials speaking to the US press.

The court filing entered by the US government confirms China is actively engaging in the theft of US intellectual property in order to advance its national interests.

China’s policies on intellectual property include a focus on the “re-innovation” of foreign technology. Techological advancement, including in the aerospace industry, is state-directed, and accomplished in part by the acquisiation of foreign technology through the theft of industrial information.

The CEO of ASQ, William Troy, along with the latest Chairman of the Board of Directors, Elmer Corbin, have gone on a publicity tour denying problems with China’s theft of US intellectual property, in order to promote ASQ’s expansion into China. ASQ hopes to recruit Chinese professionals into its membership ranks, a move some have suggested is being done to offset flagging US membership. Troy and Corbin have given interviews to the Chinese state-run media agency Xinhua minimizing China’s theft of US intellectual property and criminal theft of trade secrets. In a May 2018 interview, Corbin said:

I work for IBM, and as a matter fact we have several very big development labs in China. So we are creating IP in those labs. I don’t think that that’s a major issue, if you have the right safeguards in place.

IBM itself was victimized by Chinese intellectual property theft previously, making Corbin’s comments unclear. Oxebridge has been unable to contact Corbin for comment.

Troy and Corbin are promoting ASQ’s first US-China “Quality Summit,” which was held in May. ASQ’s position puts it at odds with the US Department of Justice, which is actively pursuing complaints of Chinese intellectual property theft and spying. The Chinese government has revealed a “Made in China 2025” initiative which US officials and others have warned is a national security threat. Per the Council on Foreign Relations:

Policymakers and security officials in the United States and other developed countries increasingly see China’s efforts to become a dominant player in advanced technology as a national security problem. The Pentagon warned in 2017 that state-led Chinese investment in U.S. firms working on facial-recognition software, 3-D printing, virtual reality systems, and autonomous vehicles is a threat because such products have “blurred the lines” between civilian and military technologies. In April 2018, U.S. intelligence agencies said that Chinese recruitment of foreign scientists, its theft of U.S. intellectual property, and its targeted acquisitions of U.S. firms constituted an “unprecedented threat” to the U.S. industrial base.

Despite this, ASQ has grown warm to the Made in China 2025 initiative, prompting criticism that ASQ — which holds quasi-governmental roles in the development of official US positions as administrator of various standards technical committees — may be undermining US interests to maximize its own profits.

“There’s a risk that companies following ASQ’s lax attitude towards China will find themselves victims, as well,” said Oxebridge founder Christopher Paris. “ASQ has incredible influence in the field of standards, impacting on thousands of companies and especially in aerospace. It has abdicated its responsibility on this issue, all to presumably sell some of its training courses to Chinese workers.

Both ISO and IAF have also been criticized for lax concern over the influence of China on international standards development and certification schemes. The former ISO president and current IAF president are both Chinese nationals, and the current ISO president has ties to the Chinese government. Meanwhile, US trade officials suspect China is attempting to use ISO’s information on standards development to create its own Chinese set of standards which it will then impose back on the US and other countries, skirting ISO’s role entirely.

Aerospace firms are routinely held to legal requirements to prevent and report intellectual property theft by China and other nations, through the International Traffic in Arms (ITAR) regulations.

GE’s Ohio operations appear to be certified to AS9100 by DNV-GL, which is accredited by ANAB. ANAB is co-owned by ASQ.

Oxebridge has criticized ASQ for its pro-China position, but has so far not called for a national boycott of the organization. Oxebridge is providing information to the US Department of Defense on weaknesses and conflicts in the ISO certification scheme, and calling on the Defense Contract Audit Agency and the Defense Pricing and Contracting agency (DPC) to initiate a 10-year moratorium on the requirement of ISO 9001 or AS9100 certification in any defense industry contracts, until the parties can be investigated. ASQ senior officials have responded by launching a defamation campaign against Oxebridge in retaliation, and have ignored calls to resolve the matter outside of US courts.


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