Two Chinese nationals have been arrested and charged with acting as illegal agents of the People’s Republic of China after allegedly conducting surveillance operations targeting U.S. Navy personnel and military facilities.
One of the suspects, Liren “Ryan” Lai, was arrested in Houston, Texas.
According to a federal affidavit unsealed in the Northern District of California, Lai and co-defendant Yuance Chen, who resides in Oregon, worked under the direction of a Chinese intelligence officer with the Ministry of State Security.
The pair allegedly took covert photos of U.S. military personnel and facilities, including Navy recruiting offices as well as naval installations in Washington and California.
Authorities allege that Lai recruited Chen to work for the MSS in 2021. Both suspects are said to have received encrypted communications and $10,000 in a “dead drop” was sent to Chen for his activities.
A key incident cited in the affidavit involved Chen surveilling the Naval Special Warfare Command in San Diego, which oversees Navy SEALs. He was tasked with photographing license plates and collecting identifying information on U.S. Navy personnel.
The affidavit also reveals that the MSS directed the suspects to identify and monitor Chinese military defectors residing in the United States.
The case is being prosecuted in the Northern District of California. Both men face charges under the Foreign Agents Registration Act, which criminalizes acting as an agent of a foreign government without notifying the U.S. attorney general.
Lai’s arrest in Houston comes amid heightened efforts by Texas officials to counter foreign espionage and influence, particularly from China.
In June 2025, Gov. Greg Abbott signed Senate Bill 17, which bans land purchases by entities linked to China and other hostile nations. This law is set to take effect on September 1.
Earlier this year, Texas Attorney General Ken Paxton issued enforcement notices to several Chinese technology firms accused of violating the state’s data privacy laws, citing concerns over surveillance risks linked to the Chinese Communist Party.
Texas lawmakers have also established a Geopolitical Conflict Advisory Committee tasked with assessing threats to state infrastructure and institutions posed by foreign actors, including China.
According to federal officials, the espionage investigation is ongoing.
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