The Department of Justice has charged an alleged Chinese spy in Houston with passing “national security information” to China.
Liren “Ryan” Lai, 39, allegedly traveled from China to Houston, where he spied on America for China’s “principal foreign intelligence service,” the Ministry of State Security.
“The Justice Department will not stand by while hostile nations embed spies in our country,” said Attorney General Pam Bondi in the release. “We will expose foreign operatives, hold their agents to account, and protect the American people from covert threats to our national security.”
Lai and fellow Chinese national Yance Chen, 38, were arrested June 28 for “overseeing and carrying out various clandestine intelligence taskings” for China, the release said. Chen was a “legal permanent resident” in Happy Valley, Oregon. They appeared in federal court on June 30 to face charges from the Northern District of California “for acting as agents” of the People’s Republic of China.
Two Chinese nationals were caught spying on our Navy and trying to recruit American service members for the CCP’s intel service.
Our FBI won’t stand for it. We tracked them, we stopped them, and we’re not done yet.
Espionage on U.S. soil will be met with full force. pic.twitter.com/VB6lQYuHWM
— FBI Director Kash Patel (@FBIDirectorKash) July 1, 2025
The suspects allegedly organized a “dead drop” of cash for national security information provided to China, recruited military members as Chinese assets, and gathered “intelligence” about Navy service members and bases.
Houston does not have an official Navy base, but it is home to Ellington Field Joint Reserve Base, which is home to the Air Force’s 147th Attack Wing. The facility also hosts the Navy Reserve Center-Houston.
“The FBI arrested two Chinese nationals who were allegedly attempting to recruit U.S. military service members on behalf of the PRC,” said FBI Director Kash Patel in the release. “The Chinese Communist Party thought they were getting away with their scheme to operate on U.S. soil, utilizing spy craft, like dead drops, to pay their sources.”
Lai allegedly recruited Chen to work for the Chinese intelligence agency, the MSS, around 2021, according to the release.
While in Guangzhou, China – just inland from Hong Kong – they reportedly worked in January 2022 to organize a $10,000 “dead drop” for information provided to the MSS. They reportedly worked with others in America to leave a backpack with cash at a “day-use locker” in Livermore, California.
Lai and Chen allegedly “continued” to work on behalf of the Chinese government, identifying “potential assets” in the Navy to recruit for espionage, according to the release.
Lai traveled from China to Houston on a “tourist visa” in April 2025. He claimed he was in the area for an online retail business, and would stay in Houston “for two weeks.” But more than four weeks after his arrival – on May 9 – he drove “with a companion” from Houston, through New Mexico and Arizona, to Southern California. He reportedly returned to Texas on May 15.
The MSS allegedly gave Chen information on how to “engage and recruit” future Navy sailors. Lai reportedly directed him in 2022 and 2023 to visit a naval “installation” in Washington state and a Navy “recruitment center” in San Gabriel, California.
While in the recruitment center, Chen allegedly “obtained personal information” for recruits that he “transmitted” to an intelligence officer in China.
At one point, he began contacting a “Navy employee” through social media and gave information about the employee to Chinese intelligence. Then, Chen traveled to Guangzhou in April 2024 and March 2025 to meet MSS “intelligence officers,” discussing tasks and compensation.
The suspects are facing federal charges for acting as “agents of foreign governments” without notifying the attorney general’s office. According to the release, if convicted, Lai and Chen could face up to 10 years in prison and a fine of up to $250,000.
China’s government conducts “intelligence activities” against America through multiple “arms,” including the Ministry of State Security, per the release. The MSS handles “civilian intelligence collection,” and conducts counterintelligence and foreign intelligence, seeking “political, economic, and security” information.
“The MSS and its bureaus are tasked with conducting clandestine and covert human source operations, of which the United States is a principal target,” the release reads.
The FBI’s San Francisco office is leading this investigation, assisted by the bureau’s field offices in Houston, Portland, and San Diego. NCIS provided “valuable assistance.”
“The PRC has for years attempted through various means to recruit U.S. service members as intelligence assets due to their access to sensitive military information,” said NCIS Director Omar Lopez in the release. He said NCIS and the Navy are “committed to working together to root out” efforts to compromise “critical warfighting and shipbuilding capabilities.”