US citizen accused of spying on behalf of Chinese government

SAN FRANCISCO (AP) — A California tour operator charged by United States (US) officials with illegally ferrying information to China was a quiet and friendly man with a taste for luxury cars, a neighbour said.

Xuehua Edward Peng, 56, of Hayward was charged in documents unsealed on Monday with being an illegal foreign agent and delivering classified US national security information to officials in China, US Attorney David L Anderson said in San Francisco. Anderson accused Peng, whom he described as a tour operator for Chinese students and visitors, of a “combination of age-old spycraft and modern technology”.

“The charges announced today provide a rare glimpse into the secret efforts to obtain classified national security information from the United States,” Anderson said.

Danilo Serrano said Peng moved in across the street from him about five years ago and kept a Lexus and Porsche parked outside. About a year ago, he bought “an expensive Tesla SUV, the nice one where the doors go up,” Serrano said.

Serrano recalled thinking, “Man, he must have a lot of money.” The US is engaged in a trade war with China. But John Bennett, the FBI agent in charge of San Francisco, said international politics had nothing to do with the arrest and charges against Peng.

“We have criminal spies that are running around in our area of responsibility and it’s the FBI’s mission to stop this, so what’s going on in the rest of the world, it doesn’t matter to us,” he said.

FBI Director Christopher Wray in July testified before a Senate panel that the FBI had more than 1,000 investigations involving economic espionage and attempted intellectual property theft. The Justice Department has brought multiple cases in the past year involving Chinese espionage and has also brought charges against operatives working with the Ministry of State Security (MSS) .

Last October, prosecutors charged a Chinese spy with attempting to steal trade secrets from several American aviation and aerospace companies, the first time an MSS operative was extradited to the US.

US attorney David Anderson announces criminal spy charges against a San Francisco Bay Area tour operator Xuehua Edward Peng in San Francisco. PHOTO: AP