China's expanding espionage operations target AI firms and military sites worldwide
Western security agencies say Beijing's intelligence services are intensifying efforts to steal technology and gather military intelligence, citing cases from the Nvidia scandal to operations in the Philippines.
Western intelligence officials say Chinese espionage is becoming more professional and widespread, targeting both high-tech companies and military installations abroad. The recent revelation that Nvidia’s former chief executive was involved with a woman suspected of working for Chinese intelligence has highlighted concerns about Beijing’s attempts to infiltrate Western AI firms.
Prosecutors in Germany allege a married couple posing as interpreters recruited AI and aerospace professors for paid lectures that benefited state-owned arms companies. New Zealand intelligence reported a Chinese-linked observatory trying to install space-tracking equipment that could also collect military data, while Taiwan says Chinese operatives use social-media monitoring and loans to pressure soldiers for secrets.
"There is a lack of appreciation for how professional the Chinese services have become," said Holden Triplett, former head of the FBI’s Beijing office and founder of Trenchcoat Advisors.
"They’re hitting on human frailty and vulnerability and they’re spending all day thinking about how to do this. Anyone can fall for it," Triplett added.
The FBI has labeled Chinese espionage a "grave threat to the economic well-being" of the United States, and Britain’s MI5 reported a seven-fold increase in China-related investigations since 2022. Canadian and Dutch agencies similarly describe China as their top counter-intelligence threat.
In the Philippines, suspected Chinese agents allegedly used drones disguised as fishing bait, posed as seafood buyers, and operated vehicles equipped with fake mobile-phone towers to collect data near naval bases and the U.S. embassy. Defence Secretary Gilberto Teodoro said the operations were "extremely widespread" and suggested similar activities occur in the United States, Australia and the United Kingdom.
Analysts note that the Ministry of State Security (MSS) now coordinates a large, aggressive espionage network that combines overseas intelligence functions with domestic surveillance, supported by reforms under President Xi Jinping that give the agency broader powers. Former CIA Beijing station chief Randy Phillips said the MSS has become "much more emboldened" over the past decade.
AI is increasingly used to streamline Chinese spycraft. The FBI and Justice Department warned that Chinese operatives employed fake consulting firms, lucrative job offers and AI-generated images to lure U.S. citizens with security clearances onto encrypted apps. CIA veteran Dennis Wilder said AI allows Chinese agents to profile targets at scale, reducing the need for risky overseas travel.
Microsoft identified a China-linked hacking group that used agentic AI to automate attacks on hundreds of organizations worldwide, and Britain’s MI5 warned that a Chinese research institute was funding AI and cybersecurity projects to enhance MSS capabilities.
"My guess is that they’ll be encouraged by how this worked out and they’ll do more and more of these operations," Triplett said, suggesting the Nvidia case may be one of many similar campaigns.
The growing sophistication of Chinese espionage underscores ongoing tensions between the United States and China over AI leadership, semiconductor dominance and military influence in the Indo-Pacific region.