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US tech secrets leaked to China
Curt Anderson
NOVEMBER 27, 2003

A HUMAN rights activist freed from a Chinese prison after the US government intercession has pleaded guilty to illegally selling American technology with military potential to China.

Gao Zhan, who was born in China but is a US resident, pleaded guilty to one count of unlawful export for selling 80 microprocessors. She also pleaded guilty to tax evasion, as did her husband, Xue Donghua.
"The technology exported in this case is tightly controlled for good reason: It can be used in sensitive military systems," said Kevin Delli-Colli, a US Immigration and Customs Enforcement agent. The US Defence Criminal Investigative Service also is involved in the case.

Gao could face up to 10 years in prison, with sentencing set for March 5. But prosecutors say she could get a more lenient sentence if she continues to cooperate with investigators trying to identify others involved in exports of sensitive goods to China. Xue, who could face up to a year in prison, also agreed to cooperate.

A spokesman for the Chinese Embassy in Washington declined to comment.

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Gao gained international attention when she was arrested in China in 2001 on charges of spying for Taiwan. She and her husband and their 5-year-old son were about to return to the United States following a visit when they were seized by government agents.

Gao was jailed. Her husband, who is an American citizen, and son were detained and separated from each other for 26 days before being allowed to return to the United States without her.

Gao's release was secured in part by a phone call from US President Bush to Chinese President Jiang Zemin , which came during a time of tense US-China relations following an mid-air collision between a US spy plane and a Chinese fighter jet.

While court documents lay out the crimes Gao admitted committing, US officials were unable to explain why China suspected her of spying against it if she had been helping the Chinese government for years before that.

According to prosecutors, from 1998 to 2001 Gao helped the Chinese government obtain more than $US1.5 million ($2.1 million) in sensitive items using a false name and a front company.

Court documents say Gao admitted to using the name "Gail Heights" to order high-tech items to be illegally shipped to China through a front company called "Technology Business Services" or "University Services" that she falsely claimed was connected to George Mason University.

US Customs officials were tipped to the scheme in 2000 by a company that had found no connection between the university and the "Gail Heights" that had placed an order for electronic parts that fall under US government export controls.

A search of Gao's home revealed contracts for similar parts with a variety of Chinese entities with ties to China's military, including China National, Incom Import & Export Co. and Nanjing Institute of Radio Technology, according to court documents.

The plea agreement involves only one of those sales, a July 12, 2000, contract with Incom for the microprocessors. The components operate at low temperatures, making them ideal for aircraft navigation, weapons fire control systems, radar and airborne battle management systems.