On Senate Floor, Portman Highlights Upcoming Legislation to Stop Theft of U.S. Research & Intellectual Property by Global Competitors

March 11, 2020 | Press Releases

WASHINGTON, DC – Today on the Senate floor, U.S. Senator Rob Portman (R-OH) addressed the rampant theft of U.S. taxpayer-funded research and intellectual property (IP) by China and how it is being used to fuel China’s military and economic rise. Portman will soon introduce bipartisan legislation to protect American research and IP from global competitors.

Portman and U.S. Senator Tom Carper (D-DE), as Chairman and Ranking Member of the Permanent Subcommittee on Investigations (PSI), led a year-long investigation into this issue culminating in bipartisan report and hearing that showed that China has utilized talent recruitment programs to incentivize U.S.-based scientists and researchers to transfer U.S. intellectual property and innovation for their own economic and military gain.  As a result, American taxpayers have been unwittingly fueling the rise of China’s economy and military over the last two decades while federal agencies have done little to stop it.  At the same time, our global competitors are sending monetary gifts to U.S. colleges and universities, earning undue influence and limiting academic freedom.  A February 2019 PSI report detailed the influence of China in our education system and the Department of Education’s lack of enforcement of foreign gift reporting for U.S. colleges and universities.  In a November 2019 letter, the Department of Education even admitted that prior enforcement of foreign gift reporting was “historically lax.”  

Following up on these investigations, Senators Portman and Carper are introducing the Safeguarding American Innovation Act to help stop foreign governments, particularly China, from stealing American taxpayer-funded research and intellectual property developed at our colleges and universities. 

A transcript of his remarks is below and a video can be found here.

“Today is a discussion about transparency and I’m going to talk about one that maybe is going to surprise some people, but it’s about the lack of transparency in about $150 billion a year that is taxpayer money that’s put into research and development. It’s money that we as taxpayers pay to places like the National Institutes of Health. The National Institutes of Health does great research and so the federal dollars go in there to try to develop cures, as an example, for diseases but also other health care research. The National Science Foundation does a lot of research on technology and science. The Department of Energy, which does a lot of the basic research on science in our country. I’m going to focus on that funding today and a specific problem that we have right now. It’s about ensuring the government remains accountable to taxpayers. It’s about ensuring that hardworking American taxpayers know where their money is going. And it’s about a specific issue of that money going to research that is then taken by other countries, particularly by China, and the need for us to address that issue in part through transparency, in part through actually some new criminal statutes to ensure there is accountability.

“Last fall the Permanent Subcommittee on Investigations did a study, and it was about a yearlong study. And we looked at this issue of China’s talent recruitment programs and more broadly other countries, but specifically what China has been doing to find researchers over here in the United States that they think are doing interesting work and recruiting those people to be able to provide that research and sometimes to have the person actually go to China to provide that research. The issue that we focused on in our report was this theft of intellectual property at research institutions and at our colleges and universities. And it was a shocking report, and we issued it late last year. It showed, as you probably know now from some of the press accounts that have arisen since then, that in fact China was recruiting individuals who were giving up their research that was taxpayer-paid. China has made no secret of its goal to surpass the United States to be the world leader in scientific research but that doesn’t mean they should use our research institution here in America, paid for by us, to accomplish that goal. These talent recruitment programs, most notably the Thousand Talents Program recruits researchers at American universities, American research institutions to do the same research usually at shadow labs in China or to just transfer taxpayer-funded research back to China. This is an issue that has been going on for two decades, we found out, and really kind of right under the nose of the F.B.I. and others.

“The F.B.I. testified at our hearing and said they readily acknowledged that they were asleep at the switch essentially. They had not been on top of it, and that only recently had they begun to focus on it. And we’ve seen the results of that, by the way. Until very recently, little was done to stop it, but recently there has been a lot of publicity. You know about probably the recent arrest of Dr. Charles Lieber at Harvard University. Dr. Lieber actually lied to federal investigators about his participation in the plan and that’s what they have charged him with. Most recently today we hear about another one, Dr. James Lewis at West Virginia University who pleaded guilty to fraudulently requesting time off to raise a newborn when he was actually in China conducting research as part of his agreement with this same group, the Thousand Talents Plan. This is a definite conflict of interest. As an example, Professor Lieber is accused of accepting $50,000 a month from the Chinese talent recruitment program, also $150,000 in funding just for his expenses. Remember he’s already being paid by Harvard. But also accepting $1.5 million to set up a shadow lab in China. He did not tell his employer, Harvard, about this. Again, he was not able to be honest in talking to the federal prosecutors, which is how he became charged. So the fraud that he was committing was not the charge because that’s not a criminal offense. It needs to be one.

“With regard to the guy from West Virginia who just pleaded guilty yesterday, we don’t know all the details yet there, but we know that this again is research that was being done, we assume partly funded by taxpayers and this talent recruitment program was able to get that research. This can lead to obviously a real problem because it’s helping to fuel not just the Chinese economy, but also the Chinese military, some of the Professor Lieber research was done for our military and therefore they got military research and we assume military secrets as well. They provide a reputational risk to the universities we’re talking about, of course, and so many others around the country. But it’s also just unfair to taxpayers because this is government-funded for the benefit of America, not to one of our stiffest global competitors. So we are working with the Trump administration to ensure that we know where that taxpayer money is going, making sure it’s going to benefit the United States of America.

“Along with my counterpart in the Subcommittee on the Democratic side of the aisle, Tom Carper from Delaware, we plan to introduce bipartisan legislation that uses the key findings in our Subcommittee report to ensure that our research enterprise is protected here in this country. Also to ensure that it continues to be open and transparent and accountable, but also secure. And our legislation does this in a few ways, and a lot of it has to do with more transparency. First it creates a new cross government counsel at the Office of Management and Budget to coordinate and streamline the grant-making process between federal agencies so we know where the money is going and how it’s being used. Right now these agencies don’t talk to each other and we don’t know much about the grant making process. We need to make that transparent. Sunshine, I think, will be a very effective disinfectant here.

“Second, the bill makes it illegal to not tell the truth on a grant application. And apparently that happens all the time now. We requested some of these grant applications from the Thousand Talents Program. We weren’t able to get all the information we wanted but we got enough to know most of these contracts apparently have the individual saying, ‘Okay, I’ll accept the money from this Chinses government through this program but I will not tell my employer about it.’ On the grant application they have to say that they will not reveal it. Obviously that’s defrauding the U.S. government.

“The third part of our legislation closes the loopholes exploited by China and other countries and empowers the United States State Department to deny visas to foreign researchers who seek to exploit the openness of our U.S. research enterprise to steal intellectual property and research from our universities and research institutions. Now this is something that the State Department has worked with us on and asked for. They’re looking for additional authority from us when they know somebody is not here on a good-faith effort to do research but rather to take our research, they want to be able to act.

“Fourth, it requires research institutions and universities to have basic safeguards against unauthorized access to sensitive technology. You would think that’s already in place, but apparently it’s not. And also it requires them to tell the State Department what technologies a foreign researcher will have access to on campus. So again, we can start talking to each other, including folks at the State Department, law enforcement folks, and people in our research institutions.

“Fifth, it directs the U.S. government to work with our critical research partners. Think of Japan or Australia or the U.K., to protect their research enterprises from Chinese theft as well. We’re not interested in having U.S. taxpayer dollars go to do research here that we then collaborate with a foreign government, an ally, and then that research is taken back to China or other countries. So we want more information about working with partners as well to protect that important research.

“And finally, it requires colleges and universities to report any gifts of $50,000 or more and empowers the Department of Education to fine universities that repeatedly fail to disclose these gifts. Current law requires reporting at the level of $250,000. If you get $250,000 from a foreign entity, you’re supposed to report it. We found in our study, shockingly that 70 percent of U.S. universities consistently fail to do that. So the universities don’t want to report the fact that they’re getting money from foreign governments. But, we need to know that. The taxpayers need to know that. Lowering the threshold from $250,000 to $50,000 and increasing this transparency, including adding the penalty, ensures that those schools will report. In my view, that will lead to accountability and what we’re looking for, which is more information. Beyond these provisions, we are all going to have to do more to protect the U.S. research enterprise. My bill makes it clear that research institutions receiving taxpayer dollars have got to do a better job, giving the government just basic information about foreign researchers they partner with.

“By the way, academics tend to agree. On Monday the President of the American Council on Education in an op-ed agreed with our report’s recommendation that research institutions should establish a ‘Know your collaborator culture.’ Know who you’re collaborating with. Know what their background is. Providing basic information about researchers and what they’ll have access to on campus allows the State Department to properly vet foreign researchers before issuing them a visa. Frankly it’s hard to believe that universities aren’t already required to tell the U.S. State Department this information, but they aren’t. A few universities and academic groups have raised concerns about administrative burdens and we don’t want to burden unnecessarily any research institution, university, or college but we do want the transparency. It’s my hope that our research institutions will step up and do their part as patriots to help us ensure that our taxpayer-funded research does not fall into the wrong hands. Research universities need to take a hard look at what’s happening on their own campuses. This threat is very real.

“If universities expect to continue to receive billions in taxpayer research dollars, Congress has got to ensure the academic community is taking basic commonsense steps to secure the research. I believe our legislation is a balanced way to ensure that will happen. We talked earlier about the actions by college professors that have now been in the media. They have been charged by the F.B.I. and others. One thing we do on legislation as well is we establish a new criminal law with regard to defrauding a university or defrauding the U.S. taxpayer. Again, the reason that these charges have been able to be brought is not because of the fraud that was committed, but because in one case someone lied about the reason they were looking for leave. And in the other case someone lied to the F.B.I. about whether they were involved in the program or not. These were perjury issues really, not in terms of the fraud. So our legislation also tightens that up.

“I think we all agree that the relationship we have with China is complicated. There is some good, there is some bad. It is in both of our countries’ interest, in my view, to have a healthy relationship and have an exchange of new ideas, have the ability to collaborate where appropriate. But we cannot allow this continued theft of taxpayer-funded research. My hope is this legislation will send a firm but fair signal to China to change their behavior, respect our laws when it comes to research, and see the wisdom of our research values here in the United States of openness, of transparency, reciprocity, of integrity, and most importantly, merit-based competition. I encourage my colleagues to take a look at this legislation. We hope to introduce it the week after next when we’re back from recess. And we believe that this legislation will be incredibly important to ensure that we can protect this research that taxpayer dollars are funding.”

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