PORTLAND Ore. (KPTV) – Federal authorities have charged two Chinese nationals with acting as unregistered agents of the Chinese government in an alleged plot to infiltrate the U.S. military and collect national security intelligence on behalf of China’s Ministry of State Security (MSS), the country’s primary intelligence agency.
Yuance Chen, 38, a permanent U.S. resident living in Happy Valley, Oregon, and Liren “Ryan” Lai, 39, living in Houston, Texas, were arrested Friday in a coordinated FBI operation in Oregon and Texas. Lai entered the U.S. in April on a tourist visa. Both appeared in federal court Monday on charges filed in the Northern District of California.
According to federal prosecutors, Chen and Lai worked under the direction of the MSS, which U.S. officials accuse of carrying out covert operations aimed at collecting political, military and technological intelligence within the United States.
Authorities allege that Lai recruited Chen in 2021 to work for the MSS. In 2022, while both men were in China, they allegedly planned a “dead drop” operation. Prosecutors say Chen’s wife traveled from Portland to San Francisco with a backpack containing $10,000 in cash, which she placed inside a locker at a bowling alley in Livermore, California. Surveillance footage shows her and an accomplice with the backpack, allegedly intended for a U.S.-based co-conspirator acting on behalf of the MSS.
The complaint also accuses Chen of receiving training from MSS officers on how to avoid detection and approach potential recruits.
In a separate incident, Chen allegedly visited a Navy recruitment center in San Gabriel, California, where he took photos of a bulletin board displaying the names, programs and hometowns of Navy recruits.
Later, investigators say Chen connected with a Navy employee through social media and arranged a private tour of the USS Abraham Lincoln in San Diego. A photo from the 2025 visit, included in the federal complaint, allegedly shows Chen, his wife and the Navy employee holding a child on board the ship.
“These arrests expose a brazen Chinese effort to undermine our national security from within,” said Attorney General Pam Bondi. “We will not tolerate foreign espionage on U.S. soil.”
Chen was booked into the Multnomah County Jail and released into U.S. Marshals custody on June 30.
If convicted, Chen and Lai face up to 10 years in prison and a $250,000 fine. The case was investigated by the FBI with assistance from the Naval Criminal Investigative Service.
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