Ex-Boeing engineer charged in China spying case

WASHINGTON (Reuters) - A former Boeing engineer was arrested on Monday on charges of stealing trade secrets for China about several aerospace programs, including the Space Shuttle, the U.S. Justice Department said.

It also announced a separate case in which a U.S. Defense Department official and two others from New Orleans were arrested on Monday on espionage charges involving the passing of classified U.S. government documents to China.

"We take every one of these cases very seriously," Assistant Attorney General Kenneth Wainstein told a news conference.

"The threat is very simple. It's a threat to our national security and to our economic position in the world, a threat that is posed by the relentless efforts of foreign intelligence services to penetrate our security systems and steal our most sensitive military technology and information," he said.

Department officials said Dongfan "Greg" Chung, 72, of Orange, California, who was employed by Rockwell International from 1973 until its defense and space unit was acquired by Boeing Co in 1996, was arrested without incident at his residence.

He was accused in federal court in California of espionage involving economic secrets, conspiracy and other charges. If convicted, he faces a potential sentence of more than 100 years in prison, the officials said.

Chung, a China native who is a naturalized U.S. citizen, held a secret security clearance when he worked at Rockwell and Boeing on the Space Shuttle program, the officials said.

He retired from the company in 2002, but the next year he returned to Boeing as a contractor, a position he held until September 2006.

According to the charges against him, Chung took and concealed Boeing trade secrets relating to the Space Shuttle, the C-17 military transport aircraft and the Delta IV rocket.

DESIRE TO HELP 'MOTHERLAND'

Individuals in the Chinese aviation industry began sending Chung letters asking for specific information as early as 1979, the officials said. Chung responded in a letter with a desire to help the "motherland."

Between 1985 and 2003, Chung made multiple trips to China to give lectures on technology involving the Space Shuttle and other programs, and met with Chinese officials during those trips, the officials said. He also sent to China 24 manuals about the B-1 Bomber.

A Boeing spokesman, Dan Beck, said his company has been working with investigators.

"We do not comment on ongoing government criminal investigations and will not comment on the subject matter of the case," Beck said. "Boeing is not a target of the investigation and has been cooperating with the government."

The other case involved Gregg William Bergersen, a Defense Department official who had a top-secret security clearance, and Tai Shen Kuo and Yu Xin Kang, both of New Orleans.

Working under the direction of an individual identified in court documents only as "PRC Official A," Kuo cultivated friendships with Bergersen and others in the U.S. government and obtained from them sensitive classified information for China.

The officials said much of the information involved the U.S. sale of military equipment to Taiwan.

The criminal conduct spanned a two-year period from January 2006 to February 2008, said the documents filed in federal court in Virginia.

Kuo, a naturalized U.S. citizen who had a furniture business in New Orleans, gathered the secret information, the officials said. Kang, a Chinese citizen and a legal permanent U.S. resident, took the secrets from Kuo and gave them to the unidentified Chinese official.

Bergersen is a weapons systems policy analyst at the Arlington, Virginia-based Defense Security Cooperation Agency, which is part of the Defense Department. He received an undetermined amount of cash from Kuo for the secrets, the officials said.

(Reporting by James Vicini, editing by David Alexander and Eric Walsh)