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ICYMI: Hearing Confirms CCP Threat to U.S. Intellectual Property, Critical Infrastructure

May 24, 2023

ICYMI: Hearing Confirms CCP Threat to U.S. Intellectual Property, Critical Infrastructure

WASHINGTON, D.C. — This week, the House Homeland Security Subcommittee on Counterterrorism, Law Enforcement, and Intelligence, led by Chairman August Pfluger (R-TX), held a hearing to assess the U.S. homeland’s vulnerabilities to Chinese Communist Party (CCP) aggression, featuring testimony from Iranga Kahangama, the Assistant Secretary for Cyber, Infrastructure, Risk and Resilience at the Department of Homeland Security (DHS); Tyrone Durham, the Acting Director of the Nation State Threats Center at DHS; and Jill Murphy, the Deputy Assistant Director of Counterintelligence at the Federal Bureau of Investigation (FBI). Their written testimony can be found here. Read highlights of the hearing below.

In the hearing, witnesses confirmed the CCP is the gravest long-term threat to the integrity of U.S. intellectual property and critical infrastructure, that it uses Confucius Institutes to steal American academic research, and the CCP uses a wide array of tactics, techniques, and procedures to spread its malign influence on U.S. soil. In addition to these conclusions, the FBI committed to working with Members of the Committee to ensure the Committee receives briefings on a host of issues regarding government oversight and the CCP.

In his opening line of questioning, Chairman Pfluger asked Ms. Murphy about a letter he and Chairman Green sent to FBI Director Wray concerning the CCP’s clandestine ‘police stations’ uncovered in New York City and reportedly elsewhere in the country, which violate our nation’s sovereignty:

“Last month, the FBI made two arrests related to the secret Chinese police station operating in New York City and charged dozens more as part of a larger [People’s Republic of China] PRC effort to locate in America pro-democracy Chinese activists and others who are openly critical of Beijing’s policies and to suppress their speech. On the 24th of April, Chairman Green and myself sent a letter to both DHS and the FBI requesting additional information about this police station. It’s now been over two weeks past that deadline that we asked for. So I would ask you please to respond to that letter in writing. […] How was a station associated with such a nefarious organization [able to] pop up in New York City?”

Ms. Murphy answered:

“The threat from China is complex and vast, and the way that they work in the United States, and I imagine other countries who are seeing similar threats from the communist government of China, is very diversified and layered. So, when we talk about universities, researchers, academics, or innovation, China proliferates all those spaces to include in our communities where Chinese Americans live as a way to influence those communities. We work actively to identify those and investigate them. […] Their attack surface is large, and they are using all the tools in their toolbox to gather information, whether it’s classified intellectual, property, sensitive, unclassified, anything that they consider of value.”

In his second line of questioning, Chairman Pfluger asked Ms. Murphy about the number of counterintelligence investigations initiated by the Department of Justice (DOJ) to identify and prosecute CCP trade secret theft and protect American critical infrastructure from covert influence:

“Do you agree with your boss, FBI Director Wray, that the greatest long-term threat to our nation’s information and intellectual property and our economic vitality is the counterintelligence and economic espionage threat from China?”

Following Ms. Murphy’s resounding agreement, Chairman Pfluger asked:

“Is it true that the FBI launches a counterintelligence case into China as often as once every twelve hours?”

Ms. Murphy answered:

“We have a lot of Chinese counterintelligence investigations. It’s probably about half of the work that we do in the counterintelligence division.”

When pressed on the total number of cases opened by the FBI’s counterintelligence division on foreign covert influence, Ms. Murphy answered:

“I’d say over two thousand.”

In his third line of questioning, Chairman Pfluger detailed findings from the Office of the Director of National Intelligence’s Annual Threat Assessment describing the malign influence operations by the CCP and asked Ms. Murphy about its use of Confucius Institutes to conduct surveillance on U.S. university campuses:

“You mentioned the work that the FBI has done on Confucius Institutes. I’m proud to sponsor a bill and legislation that gets at the heart of Confucius Institutes. Do you believe that the CCP is using malign influence to affect outcomes of research and other academia outcomes at our universities and higher institutions?”

Ms. Murphy answered:

“I don’t know if I’d say it’s to affect the outcomes, [they] are probably more to steal the research.”

Chairman Pfluger then highlighted the CCP’s dangerous encroachment into U.S. airspace with a surveillance balloon and asked Mr. Kahangama about its flight path and the threats posed by CCP land acquisitions in the U.S.:

“The well-documented approach that they’ve used to acquiring either critical minerals, critical industries, farmland, ranch land, some of them their military sites, especially sensitive military sites. Can you comment on the acquisition of this farmland and has DHS or FBI overlaid the flight path of that Chinese spy balloon that came over the United States several months ago with acquisition-acquired land?”

Mr. Kahangama answered:

“First, to your point about land acquisitions, I think thanks to Congress as well, real estate purchases are now included as within the purview of what we call CFIUS. The Committee on Foreign investment in the United States, so we do have an ability to look at land purchases when they have nexus specifically to military sites or what would be airports or seaports and conduct a risk assessment if a foreign purchase of that is subject to foreign control. […] With the balloon specifically, DHS’s CISA did track the flight path of the balloon and critical infrastructure nodes that were associated with it. I believe CISA conducted about 27 notifications and outreach to state and local and critical infrastructure entities to help them understand and mitigate against the risk.”