Software engineer accused of taking trade secrets to China

July 11, 2019 - 5:44 pm

WASHINGTON (AP) — A software engineer is accused of stealing trade secrets from the Illinois locomotive company he once worked for and taking the information with him to China, federal prosecutors said Thursday.

The Justice Department unsealed an indictment charging Xudong Yao, also known as William Yao, with nine counts of trade secrets theft.

Federal prosecutors say Yao downloaded more than 3,000 files, including trade secrets and source code, from the suburban Chicago company while at the same time negotiating and securing a job with a Chinese company.

Yao was fired for unrelated reasons in February 2015 from his job in the United States and flew months later to China to begin working for another company, taking stolen files with him, including nine copies of the Chicago company's control system source code and specifications explaining how the code worked, prosecutors said. Neither company is named in the indictment.

The case comes as FBI and Justice Department officials have prioritized the theft by Chinese companies of U.S. trade secrets and brought multiple prosecutions in recent years against employees accused of stealing proprietary information.

Some U.S. officials have specifically warned about Chinese interest in transportation.

In May, for instance, Sen. Charles Schumer, the Senate's top Democrat, called on the federal government to step in and investigate whether a plan for new subway cars in New York City designed by a Chinese state-owned company could pose a threat to national security.

Schumer requested a Commerce Department review after CRRC, one of the world's largest train makers, won a design contest for new subway cars that would include "modern train control technology."

Yao is not in custody and believed to be living in China. It was not immediately clear whether he had a lawyer.

The indictment was brought in 2017. It was unclear why it was unsealed this week.

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