Photo:AP
In late June 2025, the U.S. Department of Justice charged two Chinese nationals, Yuance Chen, 38, and Liren “Ryan” Lai, 39, with spying inside the United States on behalf of China’s Ministry of State Security (MSS).
Chen, a legal permanent resident of Happy Valley, Oregon, and Lai, who traveled to Texas on a tourist visa in April, are accused of conducting clandestine intelligence operations targeting the U.S. Navy .
What They’re Accused Of
Dead-drop payments: In 2022, authorities believe they arranged a $10,000 cash drop in a California locker as payment for Navy-related intelligence previously given to Chinese agents .
Collecting Navy intelligence: Chen reportedly gathered data on Navy bases, including personnel details, and even toured the USS Abraham Lincoln in San Diego with a Navy employee .
Recruitment attempts: The men allegedly tried to recruit U.S. Navy members to work as MSS assets, discussing potential targets and collecting personal information.
Legal Charges
They face serious charges under 18 U.S.C. § 951 for acting as agents of a foreign government without notifying the U.S. Attorney General. Each count carries up to 10 years in prison and fines up to $250,000 .
The FBI arrested Chen in Oregon and Lai in Houston on June 27, 2025, during a coordinated, multi-state counterintelligence operation.
Officials’ Reactions
Attorney General Pamela Bondi said the case “underscores the Chinese government’s sustained and aggressive effort to infiltrate our military and undermine our national security.”
FBI Director Kash Patel praised the operation as exceptional counterintelligence work and condemned the use of spy techniques like dead drops.
Why This is Important
Threat to national security
China is accused of sending secret agents to collect sensitive information that supports its naval expansion and diminishes U.S. military advantages .
Military-level espionage
Recruiting personnel within the U.S. military is a serious threat, showing China’s interest in compromising American defense from the inside.
Ongoing intelligence conflict
The case fits into a broader pattern of Chinese espionage in the U.S., such as recruiting individuals abroad or hacking sensitive systems.
Strengthened protections
These arrests reflect the U.S. commitment to identifying foreign operatives, with collaborative efforts from multiple FBI offices and federal agencies involved.
What Happens Next
Courts: Chen and Lai made initial court appearances in Portland, Oregon, and Houston, Texas, under the jurisdiction of the Northern District of California.
Legal process: They'll face trial for spying and acting as unregistered foreign agents.
Preventing future breaches: Ongoing investigations may uncover further Chinese MSS operations and lead to additional indictments.
Public awareness: The public may be notified of other espionage threats, especially involving foreign interference in U.S. security.
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