Two Chinese nationals have been charged with espionage for allegedly operating as agents of China’s government, gathering intelligence on U.S. Navy personnel and military bases. The Department of Justice (DOJ) has identified the suspects as Yuance Chen from Happy Valley, Oregon, and Liren Lai, who entered the U.S. on a tourist visa in April 2025. These individuals are accused of carrying out secretive intelligence operations for China’s Ministry of State Security (MSS).
The DOJ claims that Chen and Lai helped recruit potential MSS assets and collected information on military personnel and installations. They are also accused of facilitating a cash “dead drop” for the MSS, intended to support their espionage activities. Both men were apprehended last Friday, thanks to efforts by the FBI and Naval Criminal Investigative Service (NCIS).
“Today’s arrests reflect the FBI’s unwavering commitment to protecting our national security and safeguarding the integrity of our military,” said FBI Director Kash Patel. He emphasized that these charges illustrate the Chinese Communist Party’s efforts to infiltrate American institutions. Patel assured that U.S. counterintelligence operations remain focused and relentless in their mission.
According to a criminal complaint filed in the Northern District of California, the PRC uses various methods, including the MSS, to conduct intelligence activities against the U.S. The MSS is tasked with gathering intelligence on civilians and managing foreign intelligence, counterintelligence, and political security. The complaint suggests that Lai recruited Chen to work for the MSS in 2021.
In January 2022, the two men allegedly coordinated a dead-drop payment of at least $10,000 on behalf of the MSS in Guangzhou, China. The operation involved leaving cash in a backpack at a day-use locker in Livermore, California. Chen and Lai reportedly continued their collaboration, identifying Navy personnel who might be willing to support MSS activities.
In 2022 and 2023, Chen and Lai visited a U.S. Naval installation in Washington State and a Navy recruitment center in San Gabriel, California. At the recruitment center, Chen is said to have taken photos of a bulletin board listing Navy recruits and sent the images to an MSS officer in China. Many recruits listed their hometown as “China,” raising further suspicions.
The DOJ also alleges that the MSS provided Chen with instructions on how to communicate with potential recruits regarding payment and preferred Naval assignments. To minimize exposure, Chen was advised on specific methods of operation. The complaint details how Chen began communicating with a Navy member on social media, arranging a tour of the USS Abraham Lincoln and sharing information with the MSS.
In April 2024 and March 2025, Chen reportedly traveled to Guangzhou for meetings with MSS officers to discuss payment for his tasks. Meanwhile, Lai allegedly traveled to Houston in April 2025, claiming it was a business trip related to his online retail activities. Despite stating he would stay for two weeks, he remained in the U.S. for over a month.
On May 9, 2025, Lai was observed traveling from Houston to California and back to Junction, Texas, raising further questions about his activities. Chen and Lai are now facing charges of operating as agents of a foreign government without notifying the U.S. attorney general. If found guilty, they could each face a fine of up to $250,000 and up to 10 years in prison.
“Hostile foreign intelligence services like the PRC’s Ministry of State Security dedicate years to recruiting individuals and cultivating them as intelligence assets to do their bidding within the United States,” stated Assistant Attorney General John Eisenberg. He affirmed that the National Security Division remains committed to exposing and eliminating clandestine spy networks.
