December 4, 2022

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Code hidden in photo, files stolen: Upstate man stole GE technology to try to help China

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Schenectady, N.Y – A Schenectady County male who hid knowledge in the code of a digital photograph of a sunset was convicted Thursday of conspiracy to commit financial espionage in opposition to Basic Electric powered in order to gain the Chinese government.

Xiaoqing Zheng, 59, was at first accused of thieving GE trade techniques concerning turbine technology and scheduling to give the data to contacts in China, in accordance to federal court docket paperwork.

While the jury convicted Zheng, a U.S. citizen, of conspiracy to commit economic espionage, they could not attain a unanimous determination concerning the demand of financial espionage, in accordance to a news release from the U.S. Attorney’s Place of work of the Northern District of New York.

The proof was not strong ample to influence the whole jury that Zheng essentially despatched GE’s trade secrets and techniques to contacts in China, court documents said.

“Today’s verdict retains Xiaoqing Zheng accountable for betraying his employer and seeking to enable China cheat in the worldwide marketplace,” United States Legal professional Carla B. Freedman mentioned in the news release.

Between 2008 and 2018, Zheng was utilized at GE as an engineer specializing in sealing technology, federal prosecutors said. Zheng and other people in China conspired to steal GE’s trade secrets and techniques relating to steam and gas turbine systems, they reported.

Zheng disclosed to his employers that he was the owner of an aviation technology company, which opened in 2015, situated in China, in accordance to court paperwork. An interior GE conflict of curiosity analysis identified Zheng posed a probable menace for corporate espionage.

Zheng, an MIT graduate, downloaded and encrypted GE technologies information before sending it to his private electronic mail, in accordance to court paperwork. Zheng hid the info in a digital photograph file.

In 2014, GE corporate safety determined Zheng experienced copied around 19,000 digital files on to an exterior tricky push, in accordance to courtroom paperwork. He was interviewed by the corporation and informed them the data files experienced been deleted.

In 2017, it was identified 400 encrypted documents had been help save on Zheng’s operate laptop or computer. The information ended up encrypted utilizing a method that GE did not use, according to court paperwork. Adhering to the discovery of the encrypted files, Zheng’s laptop was monitored by the firm.

In 2018, Zheng applied a signifies of hiding data in just the code of a different file to conceal 40 documents in the code of a electronic photograph of a sunset. He then emailed the photograph file to his own email account, according to court paperwork.

“Zheng’s use of encryption and steganography approaches are both unusual and serve no evident intent but for concealing his things to do from his companies,” court docket paperwork stated.

The total encryption process took Zheng much less than 10 minutes to finish, in accordance to the criminal criticism doc. A federal investigator told prosecutors this implied Zheng had utilized these techniques in the previous.

In late 2018, FBI agents executed a federal research warrant at Zheng’s residence in Schenectady County. In the course of the research they identified the following:

  • A handbook that clarifies the type of resources the govt of China will give persons who can present sure systems.
  • Zheng’s passport displaying five worldwide trips to China in the earlier two many years.
  • Numerous electronic things, which were confiscated for forensic examination.

In an interview with federal investigators next the lookup of his household, Zheng said he experienced applied this encryption strategy on 5 to 10 situations in get to steal materials belonging to GE, according to courtroom paperwork.

He also informed investigators that the firm he have in China, which functions on the exact same systems as GE, gained funding from the Chinese govt.

“Zheng conspired to steal trade secrets from his employer, GE, and transfer this details to his business enterprise spouse in China, so they could enrich by themselves and providers receiving aid from the PRC government” Assistant Legal professional Standard Matthew G. Olsen stated in the launch.

Right after his conviction, Zheng faces up to 15 several years in federal jail and a great of up to $5 million, prosecutors claimed. He will be sentenced on Aug. 2.

Personnel writer Anne Hayes covers breaking information, crime and general public safety. Have a tip, a story thought, a question or a comment? You can reach her at [email protected].

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