US citizen charged with spying for China as part of elaborate espionage ring

‘The conduct charged in this case alleges a combination of age-old spycraft and modern technology’

A man from California has been arrested and charged with spying for China as part of an extensive espionage operation.

Officials said that Edward Peng, 56, also known as Xuehua Peng, had been taken into custody and charged with acting as a courier to provide classified information to the authorities in Beijing.

While he himself did not obtain the information, he passed it on via a system of “dead letter drops” in hotel rooms across the country, prosecutors said.

It said that he dropped off money and picked up secure digital cards, that he then transported to China in person.

“The conduct charged in this case alleges a combination of age-old spycraft and modern technology,” US attorney David Anderson said on Monday.

“The charges announced today provide a rare glimpse into the secret efforts of the People’s Republic of China to obtain classified national security information from the United States.”

The revelation of Mr Peng’s arrest comes amid a tense relationship between the two countries as both sides dig in over a trade war.

Donald Trump had long accused China of unfair trading practices and intellectual property theft. So far, the US president has imposed tariffs on more than $360bn of Chinese imports and is set to raise the taxes on most of them next month. He plans to tax an additional $160bn with of Chinese goods by mid December. Beijing has retaliated by taxing $120bn of US imports.

Reports said Mr Peng was detained last Friday in Hayward, California, and was denied bail during an initial court appearance before a judge the same day. It is not known whether he has a lawyer or has had the opportunity to enter a plea.

Reports said Mr Peng, who works as a tour and sight-seeing operator for Chinese tourists in the Bay Area, faces a maximum sentence of 10 years in prison and a $250,000 fine if convicted.

NBC News said Mr Peng, said to be a member of China’s ministry of state security, was arrested after the FBI launched a “double agent operation” in March 2015, according to a criminal complaint filed in court.

It said that as part of the investigation, a confidential FBI source met with MSS intelligence officers, provided them with classified information relating to national security concerns, and received financial payments in return.

It claimed that on six different dates, Mr Peng showed up to collect packages left at hotels in California and Georgia.

Additional reporting by agencies