Two Chinese nationals have each been sentenced to 30 months in federal prison for operating as unauthorized agents of China’s intelligence service, conducting covert financial transactions and gathering information about American military personnel and installations.
Liren “Ryan” Lai, 40, and Yuance Chen, 39, were also sentenced to three years of supervised release after pleading guilty to conspiring to act as agents of a foreign government and operating under the direction of China’s Ministry of State Security without notifying the U.S. attorney general.
Federal prosecutors said the men participated in intelligence operations dating to at least May 2021, including arranging secret cash payments, collecting information about U.S. military facilities and identifying American service members who could potentially be recruited as intelligence sources.
“Liren Lai and Yuance Chen operated in a long-running scheme to undermine U.S. national security by supporting Chinese intelligence operations and recruiting in the United States,” said John A. Eisenberg, assistant attorney general for national security.
According to court documents, Lai recruited Chen to assist China’s Ministry of State Security. Lai initially served as an intermediary between Chen and Chinese intelligence officers before Chen began receiving assignments directly.
In January 2022, while both defendants were in China, they coordinated with individuals in the United States to place a backpack containing approximately $10,000 inside a locker at a recreational facility in Livermore, California. Such a covert exchange is known as a “dead drop.”
Beginning in 2022, Chen obtained photographs of Naval Base Kitsap in Bremerton, Washington, and photographs and videos of recruits and active-duty sailors inside a Navy recruiting station in Southern California. Prosecutors said he also collected personal identifying information about a Navy employee and biographical details about military personnel considered potential recruitment targets.
In March 2023, Lai delivered Chen a cellular telephone for covert communication with the ministry. Chen traveled to China in 2024 and 2025, where he met intelligence officers and received additional assignments. In May 2025, Chinese intelligence officers directed Lai to travel to Phoenix to facilitate another clandestine payment of approximately $20,000.
Both men were arrested June 27, 2025. Lai pleaded guilty Dec. 12, 2025, and Chen pleaded guilty Feb. 20, 2026.
The FBI’s San Francisco Field Office led the investigation with assistance from other FBI offices and the Naval Criminal Investigative Service. Prosecutors from the Justice Department’s National Security Division and Northern District of California handled the case.