FBI Arrests Two Alleged Chinese Spies Targeting U.S. Navy in Oregon

(LibertySociety.com) – Two Chinese nationals were caught red-handed in an elaborate espionage operation targeting the U.S. Navy, with one suspect brazenly photographing recruitment bulletins and arranging tours of aircraft carriers while the other delivered cash-filled suitcases to military personnel.

Key Takeaways

• FBI arrested Yuance Chen (Oregon) and Liren Lai (Houston) on June 27, 2025, for acting as agents of China’s Ministry of State Security (MSS) without proper registration
• The suspects allegedly recruited Navy personnel as assets, facilitated at least one $10,000 “dead drop” payment, and gathered intelligence on U.S. naval bases
• Chen arranged a tour of the USS Abraham Lincoln and transmitted sensitive information to MSS handlers in China
• Both men face up to 10 years in prison and $250,000 fines if convicted
• FBI Director Kash Patel called the arrests evidence of China’s “sustained and aggressive effort to infiltrate and undermine U.S. institutions”

Chinese Espionage Network Dismantled

The FBI has struck a significant blow against Chinese intelligence operations on American soil with the arrest of two alleged spies targeting the U.S. Navy. Yuance Chen, a resident of Happy Valley, Oregon, and Liren Lai, who entered the country on a tourist visa in April 2025, were apprehended on June 27 in a coordinated operation involving the Naval Criminal Investigative Service (NCIS). Both men are charged with acting as agents of China’s Ministry of State Security (MSS) without notifying the U.S. Attorney General, a violation that carries serious national security implications.

The arrests come amid growing concerns about China’s aggressive intelligence gathering efforts targeting American military capabilities. According to federal investigators, Chen and Lai were not merely passive collectors of information but active recruiters attempting to compromise Navy personnel. Their alleged activities included facilitating payments of at least $10,000 for classified information and establishing communication channels with service members who had access to sensitive military installations and information. The brazen nature of their operations suggests a concerning level of confidence in operating on American soil.

Sophisticated Spy Tactics Revealed

Court documents paint a picture of sophisticated espionage tradecraft employed by the suspects. Chen, operating from Oregon, allegedly photographed a Navy recruitment bulletin and transmitted the images directly to his MSS handlers in China. Perhaps most alarmingly, he successfully communicated with a Navy member via social media and arranged a tour of the USS Abraham Lincoln, one of America’s premier nuclear-powered aircraft carriers. After gathering information during this visit, Chen reportedly shared the service member’s personal details with Chinese intelligence officers.

Lai’s operations were equally concerning. Despite entering the country on a tourist visa, he traveled from Houston to Southern California in May 2025 to deliver a suitcase to a Navy employee—a clear violation of his visa conditions and a textbook example of a covert intelligence operation. Both men allegedly met with MSS officers in China in 2024 and 2025 to coordinate payments for intelligence tasks, demonstrating the long-term nature of their espionage activities and their direct connection to the Chinese government’s intelligence apparatus.

“The Chinese Communist Party’s Ministry of State Security is actively recruiting Americans to spy for them, and they’re targeting our military personnel,” said FBI Director Kash Patel. “These arrests reflect our unwavering commitment to protecting our national security from hostile foreign intelligence services seeking to infiltrate and undermine U.S. institutions.”

National Security Implications

The targeting of Navy personnel and installations represents a direct threat to American military readiness and operational security. The U.S. Navy maintains some of the most advanced military technology in the world, from nuclear submarines to carrier strike groups that project American power globally. Intelligence on these capabilities, their operational patterns, or the personnel who operate them could provide China with significant strategic advantages in any potential conflict scenario in the Indo-Pacific region.

U.S. Attorney General Pamela Bondi didn’t mince words about the severity of the threat, stating that the case underscores China’s “sustained and aggressive effort to infiltrate our military.” She vowed that the Justice Department would continue to “expose foreign operatives and protect against covert threats” to American national security. This case appears to be part of a broader pattern of Chinese espionage efforts targeting not just military assets but also economic, technological, and academic institutions across the United States.

“The Chinese government’s flagrant disregard for international norms and sovereignty is on full display in this case,” said a senior NCIS official involved in the investigation. “They’re not just seeking information—they’re actively recruiting Americans to betray their country and compromise our national defense capabilities.”

Legal Consequences and Deterrence

If convicted under 18 U.S.C. § 951 for failing to register as agents of a foreign government, Chen and Lai each face up to 10 years in federal prison and fines of $250,000. While these penalties are substantial, some national security experts question whether they are sufficient deterrents given the scale and persistence of Chinese intelligence operations. The Department of Justice’s National Security Division has emphasized that dismantling foreign spy networks operating on U.S. soil remains a top priority.

The case also raises questions about counter-intelligence resources and priorities. Despite increased awareness of Chinese espionage threats, the fact that these operations progressed to the point of actual meetings with Navy personnel and tours of military assets suggests potential gaps in security protocols. The Biden administration has faced criticism from some quarters for not taking a sufficiently aggressive stance against Chinese intelligence activities, though officials point to these arrests as evidence of their commitment to confronting the threat.

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