Chinese espionage....

Chinese espionage might have crippled Nortel...

An ominous pattern of economic espionage has cost American companies at least $13 billion in recent years as corporate spies sell everything from chemical secrets to military technology - with China being the most persistent perpetrator, according to federal authorities.

"It's never been a more significant issue than it is right now,'' said Frank Figliuzzi, in charge of the FBI's Counterintelligence Division.

Retired engineer David Wen-Chyu Liou, a naturalized U.S. citizen from China who worked for Dow Chemical Co. and lived for a time in Houston until he was convicted and sentenced to federal prison this year, was paid $600,000 for selling Dow's chemical secrets to two Chi-nese companies.

"I'm not a Chinese spy," Liou, who is to start his sentence in June, told the Houston Chronicle. "I am just an ordinary retiree, but they turned me into some kind of international spy."

While employed by Dow for 27 years, Liou worked on the intricacies of things like Styrofoam, Napalm and Ziploc baggies. After retiring, he developed a business as a consultant helping his native China revolutionize its method of manufacturing chlorinated polyethylene, CPE, a polymer used for automotive hoses, electric cable jackets and vinyl siding.

But there was a problem: The world's best-selling brand of CPE, Tyrin, belonged to Dow.
A Dow lawsuit against Liou and his business associates led to an FBI investigation, a federal indictment, a guilty verdict and a five-year prison sentence imposed in January.

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