Espionage, overseas pfizer and conducts National Security reviews. Selected about two years ago, almost two years ago to lead the Chinese Initiative at chineseto counter the persistent and aggressive economic espionage. Thats a lot of what we will talk about today. Prior to his service as the assistant attorney general, john was the Vice President and assistant attorney general counsel at boeing. You are the first generation, right . Is relatively new and you were there starting in 2006. So, a long career. Distinguished, and thank you for doing this. What we are going to do today is , john will talk for a few minutes. We will have a conversation, then we will turn to the audience. Get your questions ready. We will screen them, but we will be happy to entertain anything you want to ask. Me andks for having proposing that we do this. The National Security division has done a number of events, including our 10 Year Anniversary event in 2016. More recently, on this topic, earlier this year we were kind of looking at the one year mark on this topic. But this is a topic that continues to develop over time. Thank you for having me. Just for a little background on what the China Initiative is here at the department, it really was in organic an outreach that the prior attorney general and i were receiving on a daily, every other day basis. We were seeing in those briefings how much theft of intellectual property was emanating from the Chinese Government. We began talking about what we can do to step up our efforts to combat this. Obviously this false squarely in nscs portfolio. And they have been working on the issue. The question was, what more can we do . We came up with the China Initiative, which was to focus on theft of intellectual property. Property by the Chinese Government. Mainly on the south side. 80 of our economic espionage that the department brings. That means theft of intellectual property on behalf of the government itself, for the benefit of the government involved china, the Chinese Government. Trade cases involved china. So the trade secret denominator is bigger. That includes any theft of intellectual property by anyone, anywhere, not necessarily government oriented or for the benefit of the government. That is the kind of thing we were looking at. Together we put this together for a couple of purposes. We were focused on this issue and prioritizing it. A lot of it was a message to the United States attorney. The bulk of the investigations. These cases are difficult. They are not cases where you will have high numbers every year. We want the u. S. Attorneys to understand. He was going to understand that you had one economic case in a year, that is a good year in a given district. Two is fantastic, zero is not a shocker. These are not going to be cases where you have 30, 50, 100, 150 cases a year. To docond thing we wanted was empower the u. S. Attorneys around the country to develop relationships with the private sector and with academic and research institutions. Those of us that live in this space, what becomes difficult is when you go out and talk about it. You can get paralyzed because you think i learned all this in a classified environment. Academic institutions of that them to theer materials and training is we did. We need the private sector in this, working with us to help us. The third goal is to look at other tools. Looks at foreign acquisitions here in the u. S. , mainly of technology but increasingly of data, we can talk a little bit about that. We will make sure that we were adequately focused on the National Security risks. Off two autumns ago. We were building on a series of cases that began in about 2014 of thee first indictment Peoples LiberationArmy Officers for cyber intrusion. It was for a variety of companies and institutions. Moment. A seminal i always like to start there. You start to realize that many are Traditional Law enforcement action. Ones with significant Foreign Policy ramifications. Back in the obama administration, getting the entire inner agency on board with the idea that the Justice Department would charge a number of their it was a big lift. But we went ahead. That is a precedent we have been able to build on. We have a cyber indictment. That one involving state security of chinese intelligence. We were building on that. What we were trying to combat is what i have called a replicate and replace approach to Economic Development that we were saying from certain people in the republic of china. That is stealing American Intellectual property, replicating that product and the u. S. Company. We saw this being done there were individuals at academic areitutions in the u. S. Who bringing the technology to china. Even within that, there were a couple of different things. One set that i think was the state directed cases. Ant we saw since 2014 was expansion of response abilities within the Chinese Government from your people Liberation Army hacking. To the use of the chinese intelligence services, taking electrical property. As a consequence of that shift, who was working on this issue on the chinese side, you have a shift in tactics. When you bring in the intelligence services, what they are really good at is developing relationships to get information. That is the trade since the beginning of civilization. We are seeing them develop relationships with individuals and companies here. In order to coopt them and give them the information there. That is what we have done for a long time. That means a lot of our cases are not just the cyber intrusion cases. They are these insider cases. Thexample of that would be mss officer that we extradited from belgium two years ago who u. S. Oopted an individual Aerospace Company in order to steal commercial jet Engine Technology and bring it to china. Are peoplecategory who have been induced by chinese to take intellectual property from their employer. Whether it is a company or chinasity, take that to one way or another by entering into the thousand talents contracts. You can get paid for either doing work there or transferring the intellectual property. This is a program that at one level is totally fine. This is about recruiting the best team in town from around the world and bringing it to china. Something a lot of companies do. A lot of organizations do it when they go for the best people. It has an underbelly. The underbelly is that when you apply for this program, it is a very formal process. You have to show that youre going to bring intellectual property there. Cases weok at the broadcom a lot lot or academic cases. A hallmark of the ones we charged is that they are hiding their affiliation. This was not working at one company and then having a weekend job or Something Like that. These were individuals they were hiding from the u. S. Government. They were getting grant money to do the real do the same research. If you look at our cases, they are all found in fraud, tax fraud, grant fraud, things like that. We didnt really have that piece of mind that develops. I was is talking to somebody on the board of big tech universities. What is the reaction to the universities . I know this is a little off topic. Click here is the thing, when i go to a company, i say the most important thing is that you protect the intellectual property they differentiate you from yourntiates you competitors. People are like that is what im supposed to be doing. If you go to university with a very different environment, that is one that begins that the chinese are taking advantage of. Of beingark successful, publishing your findings, not keeping your secret to monetize. You go there and you start to talk about theft of intellectual property. It sounds very different. T we have been emphasizing here is the risk that you are facing, here is what is happening. We can talk about the recent actions involving the pla researchers in this context. What we are saying is we expect you to have a clear conflict of interest and conflict of commitment policies so that your disclosures to the federal government are accurate. Thatf youre comfortable your professor has this relationship with china and it has all been disclosed to you, we are not going to tell you not to do it unless the information was classified. We are not going to tell them what to protect but we will push. He value of transparency case, look at the Harvard Harvard probably got the most notice. These are all allegations, using that name as part of this collaboration with the chinese university. Openly, at least with respect to the university, the university could decide what is inbound and what is not inbound. It is a different reaction but we have been working hard with the university. Ouras hampered us in ability to continue the outreach but we are doing what we can. It has been a busy couple of months. People will be disappointed if we dont talk about tiktok. Houston has long been on a radar screen of the fbi. This includes recruitment into the talent program, spotting and assessing. Then, on the foreign influence , we can at least talk about this. I hope we will be able to talk more about this. That is why houston was not chosen at random. They were actually at the forefront. The closure of the houston consulate and the simultaneous actions taken with respect to the pla people who were here but not disclosing their affiliation, there were not disclosing their affiliation. These were all attempts at disruption of what we had been tracking for quite some time, the activity here in this country. Seen publicly in , ims of those disruptions think more than 50 interviews. This is what we were trying to disrupt with the bureau together. We recognize that we are not going to be able to prosecute our way through these issues. Years of people being sent here. Take his action to disrupt that level of activity. That is the best way to understand what was happening on the pla side. What you said in a good alienate billions of 15yearolds but do you want to talk a lot bit about tiktok . It alienated me from my daughter as well. What are the National Security concerns with tiktok . It was an interesting case. Let me step back and say one of the things that exploded on the as recently as the equifax. We have seen that cyber intrusion side. See targeted acquisitions. This is traditionally thought of as protecting technologies. The fact that more and more Smart Technologies exist. Those Smart Technologies are gathering data continually on the way youre living your life. What is interesting about tiktok is you have one of the first instances in which individuals providingg up for and the app with their sensitive personal data. There is information you can give. Some people tell the truth, some dont. That thee is the data app collects about you while it is on your phone. Apps, thatof other app is collecting geolocation data. It is connecting your contact list. It is following your use of the phone. It can be used and abused by the state. This is a sensitive personal database. The second is what we saw, a lot of allegations when it comes to censorship. Hong kong, protest, tibet, taiwan. The content being censored. What is interesting about tiktok instances of americans voluntarily signing up. Obviously there is more for that process to play up but we will see how it goes. You have huawei, China Telecom and the u. S. , you have tiktok and . 10. What is the goal for the administration . They are very focused on telecommunications as you point out. There is a real appreciation, especially as we move to 5g technologies. Anyone who things are better for a little while realizes so much of your life is running over telecommunication right now. Never more so than during covid. Your professional life, banking life, personal life, your social life, on and on. More and more things are going to be connected through 5g. Your oven is connected to your phone if you wanted to be your refrigerator. All of these things can be used to paint a very interesting picture of your life. The networks over which all the data is running is really paramount to National Security in the century. Licenses, theions is a desirei it to ensure that we have trusted vendors from trusted countries and countries that share our political values. They are running these Telecommunications Networks over which our lives are already running. This brings up the issue of cooperation with other countries. We are not the only ones to experience chinese espionage. The canadians have people taken hostage. How do you assess cooperation . What is the effort to cooperate with allies in these cases . There has been a tremendous to cooperate with these other countries. There. Out from it has been a difficult road. Changed hist position on the use of huawei and 5g networks. That is the result of a lot of discussions and then trying to illustrate the risk. Against thing we are up in these discussions is not a failure to appreciate with the about thet is a worry Economic Impact that angering a country like china can have. China remains a tremendous market for a number of these countries, investment opportunities, Foreign Direct Investment into them, investment by their companies. We have seen numerous reports of this. They are held over the heads of these countries as they are in thiscision chinas behavior during the coronavirus has actually helped move some people into our camp, especially in europe by illustrating some of the risks. Footnote, we have a separate project with my colleague interviewing scandinavian countries. One thing that surprised me about chinese investment, how many of them brought up hong kong. Something that created unhappiness. For our chinese viewers, no offense. I think youre right. Has been through the biggest issues. Especially in my discussions with the europeans, those are lifessues that brought to some of the risks we were talking about. It also solidify the importance we have a lot of disagreements with europeans. At the end of the day, we do share the same political values. When having helpful these discussions. Kong withned in hong the breaking of the promises, what is happening has really helped us. I want to come back to the economic issues. Since you brought it up, one of the things i admired in the indicative in the executive orders, it looks like it was skillfully written. Apps are a new problem, you have a Foreign Service located outside the u. S. , made by another country. What were you guys thinking when you wrote the app language . The europeans share that problem. What are you thinking in terms of the territorial sovereignty . What is the story on that . The problem that tiktok illustrates best. That is that you have they are available on your app store. You have users that are choosing to download those. Once you do that, you have no idea where any of that data is going. Mostf us, here is the ubiquitous. Apps that we use, we dont really appreciate everything our phone is collecting on us in our lives. We tolerate that risk if we think the worst thing that is going to happen is that im going to get strange solicitations for something that i did not realize anyone ever knew i was interested in. I was talking while siri was on and siri picked that up. Watched an app for the very thing i was talking to my wife about. We tolerate that because it provides us with benefits. Once you start looking at that from a National Security perspective and thinking about that they are collecting on you, it is a very different matter with very different values and without the same rule of law and separation of powers that we have. One of the chinese doing with this data . That is the other question that often comes up. What are the chinese doing with this data . That is the question that comes out. It is to perfect the artificial tools algorithm. One of them is that. The second is more from a counterintelligence perspective. Be of that data will not something theyre interested in from a counterintelligence perspective. Once they are interested in if they can mind those existing data sources to find persons Financial Life is like, what their health life is like, what their married life is like, if you are a married person and you have a dating app on your phone, that is a little strange. They can use all that to paint a very effective picture of you and to think about where your vulnerabilities might be or even how best to approach you, how to approach you for that purpose. That is what we think they are information and then geolocation is very important for targeting someone if that is what youre doing. I dont mean targeting by killing, targeting by following around. Moveone does not throughout the workday. Of in a secure facility. Your phone probably moves during the workday. It is in your pocket. Say i have one job but in fact you see my phone having it away that i have another job, that tells you a lot about me too. That theher Company Executive orders went after his . 10 and we chat. Wechat. Nt and if they were anywhere else, they would be giving American Companies a real run for their money. A very popular app, not a lot of users in the u. S. But it did not seem to go after the game side of tencent. I dont want to ruin their business. Most ofwhere they make their money in the u. S. They have some really good games. You are alienating even more teenagers. Exactly. There was not an oversight in the graphing of that. This is a communication app fundamentally. It does collect a lot of the same information about the users that we were talking about before. There is that piece of it. In addition, we chat is used in the u. S. As a method by the communicate