FBI officials announced on July 23 a nationwide campaign geared toward educating business and industry leaders about the growing threat—and mounting losses—of economic espionage. As part of the campaign, the FBI is releasing to the public a short video, The Company Man: Protecting America’s Secrets. The video, created by the FBI in collaboration with the National Counterintelligence and Security Center, is based on an actual case involving the attempted theft of trade secrets from a United States company by a foreign competitor.
Although the exact dollar figure on the costs and losses to U.S. businesses as a result of economic espionage is difficult to accurately report, the losses are substantial. In a 2013 report by the Blair Huntsman IP Commission examining the theft of American intellectual property, the study estimates the total losses are estimated to be in the “hundreds of billions” each year. Those numbers do not take into consideration those companies who either do not detect, do not report, or under-report losses tied to economic espionage.
Those responsible for the theft are usually foreign competitors or governments looking for trade secrets, production methods, innovations, and even insights into labor or trade disputes. According to Assistant Director Randall Coleman of the FBI’s Counterintelligence Division, investigators are not only seeing an increase in attempts to steal proprietary information but those attempting to steal those secrets are getting more brazen in their efforts.
“We’ve had cases, and it’s outlined in the video, where we have people literally walking into warehouses and factories attempting to steal secrets,” said Coleman. “It’s actually shocking the lengths they will go to try and steal information.”
These foreign competitors deliberately target economic intelligence in advanced technologies and flourishing U.S. industries. Foreign competitors operate under three categories to create an elaborate network of spies:
- Aggressively target current and former foreign nationals working for or retired from U.S. companies and research institutions;
- Recruit and perform technical operations including bribery, discreet theft, dumpster diving (in search of discarded trade secrets), computer intrusion, and wiretapping; and,
- Establish seemingly innocent business relationships between foreign companies and U.S. industries to gather economic intelligence, including proprietary information.
The FBI and the Department of Justice have recently announced several high-profile cases involving the theft of trade secrets, including:
- Yihao Pu, a computer science engineer who was sentenced in January 2015 to 36 months in prison and ordered to pay more than $750,000 in restitution in connection with his theft of sensitive trade secrets from a trading firm in New Jersey and a Chicago-based financial firm.
- Walter Lian-Heen Liew (aka Liu Yuanxuan), a California man who was sentenced in July 2014 to 15 years in prison on multiple economic espionage-related charges and was ordered to forfeit more than $27 million in profits in connection with his theft of trade secrets from DuPont regarding its chloride-route titanium dioxide (TiO2) production technology and the subsequent selling of that information to state-owned companies of the People’s Republic of China.
Traditionally, the most likely targets for economic espionage have been large corporations with a nexus to products and services relating to the U.S. government, but Coleman points out the targets of the theft are also changing. “While those defense and technology industries will always be targets, we have found that the secrets behind any product—an irrigation sprinkler head, for example—can be valuable in the hands of someone who wants to find out how it works,” said Coleman.
The goal of the FBI’s campaign is to not only raise awareness of the threat of economic espionage but to educate those with proprietary information about the warning signs of an insider threat or attempted breach. Each of the FBI’s 56 field offices has an assigned strategic partnership coordinator, whose goal is to liaise with local companies, trade groups, and industry leaders about the threat. In the past year, FBI investigators have provided more than 1,300 briefings to companies and industry leaders discussing the current threat of economic espionage. To learn more about the threat, please visit the FBI’s website. If you are a company or feel you have been the target of an economic espionage attack, please contact your local field office.