Federal prosecutors charged a high-profile Massachusetts Institute of Technology mechanical engineering professor with fraud Thursday, alleging he failed to disclose extensive ties to and funding from the Chinese government in grant applications to the U.S. Department of Energy.

The professor, Gang Chen, was arrested at his Cambridge, Mass., home Thursday morning. The professor received $19M from the Obama administration and $29M from the Chinese Communist Party.

The Chinese government recruits hundreds of science & technology researchers to apply for talent plans. While participating in a talent plan is not inherently illegal, the Chinese govt. often coerces participants to steal foreign technologies.

The press release of Department of Justice says:

Gang Chen, 56, was charged by criminal complaint with wire fraud, failing to file a foreign bank account report (FBAR) and making a false statement in a tax return. Chen will make an initial appearance today before Magistrate Judge Donald L. Cabell.

According to charging documents, Chen is a naturalized U.S. citizen who was born in China. He is a professor and researcher at MIT where he serves as Director of the MIT Pappalardo Micro/Nano Engineering Laboratory and Director of the Solid-State Solar Thermal Energy Conversion Center (S3TEC). Since approximately 2013, Chen’s research at MIT has been funded by more than $19 million in grants awarded by various U.S. federal agencies.

Since 2012, Chen has allegedly held various appointments with the PRC designed to promote the PRC’s technological and scientific development by providing advice and expertise – sometimes directly to PRC government officials – and often in exchange for financial compensation. This includes acting as an “overseas expert” for the PRC government at the request of the PRC Consulate Office in New York and serving as a member of at least two PRC Talent Programs. Since 2013, Chen allegedly received approximately $29 million of foreign funding, including $19 million from the PRC’s Southern University of Science and Technology (SUSTech).

It is further alleged that Chen’s efforts to promote the PRC’s scientific and economic development were partially detailed in a February 2016 email that Chen sent himself using his MIT e-mail account.  The email read:

1. promote chinese collaboration

2. China places innovation (scientific) as key and core not fashion [sic], but because

we must do it, from historic trend as well from our stage

3. our economy is no. 2, but from technology (structure of economy) and human

resources, we are far from no. 2

4. we are paying big price in environment, not sustainable, as well as from labor cost

5. environment protection and development in same place, environment even higher, clean energy if higher cost, reduce steel, cement. We must count on technology, cannot grow as past

6. communist 18th convention, scientific innovation placed at core. We realize not just independent innovation; but also internationalize to plan for and facilitate. Closed door innovation does not work; innovation as driving force

From at least 2017 to 2019 when Chen was serving in several advisory roles for the PRC and PRC entities, Chen applied for and obtained a U.S. Department of Energy (DOE) grant in order to fund a portion of his research at MIT.  In doing so, it is alleged that Chen failed to disclose information about his ongoing affiliations with the PRC as required by DOE.

Chen also allegedly failed to disclose to the IRS in his 2018 tax return that he maintained a bank account in the PRC with more than $10,000 in 2018.

The charge of wire fraud provides for a sentence of up to 20 years in prison, three years of supervised release and a fine of up to $250,000. The charge of making false statements provides for a sentence of up to five years in prison, three years of supervised release and a fine of $250,000. The charge of failing to file an FBAR provides for a sentence of up to five years in prison, three years of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.

FBI Boston Division’s SAC Joe Bonavolonta joins our law enforcement partners in announcing today’s arrest of
MIT Professor Gang Chen for grant fraud and allegedly failing to disclose his work for the People’s Republic of China.

The Trump administration has worked to combat what it views as aggressive efforts by Chinese government-linked entities to improperly obtain U.S. academic research and conduct other alleged meddling at U.S. campuses. Federal prosecutors have brought more than a dozen criminal cases accusing academics of lying about receiving Chinese government funding or alleging that visiting researchers lied about their affiliation with the Chinese military.

“The problem is not the collaboration itself,” said Andrew Lelling, U.S. Attorney for the district of Massachusetts, referring to work that researchers may do with foreign entities. “The problem is lying about it.”

MIT responded to the news: “MIT was deeply distressed by the arrest of Prof. Gang Chen. MIT believes the integrity of research is a fundamental responsibility, and we take seriously concerns about improper influence in U.S. research. We are not able to offer any further information at this time.”

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