Bloomberg News on Tuesday published an exposé on the relationship between China’s Huawei telecom giant and Optica, a nonprofit scientific foundation based in Washington, DC.
According to documents reviewed by Bloomberg, Huawei and Optica had much deeper and stronger ties than either was willing to acknowledge in public.
Tuesday’s report was a follow-up to Bloomberg’s report in May that revealed Huawei has been “secretly funding cutting-edge research at American universities” through Optica. The Chinese Communist-linked firm turned out to be the sole funder for an annual research competition administered by Optica, a fact that was not disclosed to entrants in the competition.
Several major U.S. universities said they would not have participated in the research competition if they had known it was financed by Huawei. After the report prompted a congressional investigation, Optica returned Huawei’s funding and removed representatives of the company from the panel of judges for its research competition.
On Tuesday, Bloomberg cited “internal Optica corporate records” that said the group was far more closely linked to Huawei than previously revealed. Among other details, a whistleblower inside the company revealed that Optica CEO Elizabeth Rogan paid a visit to Huawei headquarters in April that she did not disclose, even though her trip to China that month was public knowledge and she was chronicling her journey in real-time on social media.
The same whistleblower expressed concerns that the Chinese company was using its relationship with Optica to compromise sensitive projects funded by the U.S. government, including the Defense Advanced Research Projects Agency (DARPA).
Contrary to earlier denials by Huawei and Optica, the documents viewed by Bloomberg indicated that Huawei did have a role in choosing the winners of the research competition, and it used the contest as an opportunity to develop contractual relationships with the participants. Optica representatives said Bloomberg’s analysts were misinterpreting these documents and exaggerating the role Huawei played in choosing the winners.
Bloomberg pointed to circumstantial evidence that China has used its pipeline to the American scientific community to acquire banned technology, such as Huawei cheekily rolling out “a new smartphone featuring a 7-nanometer chip whose development U.S. export controls were supposed to foil” while Commerce Secretary Gina Raimondo was visiting China last August.
Tuesday’s report uncovered another program that did not disclose its sponsorship by Huawei, the Global Environmental Measurement and Monitoring Initiative (GEMM). The co-chair of this program was a “U.S. government chemist with the National Institute of Standards and Technology.”
Optica’s alliance with Huawei appears to date back to at least 2007, five years before the House Intelligence Committee released a landmark report that identified the Chinese company as a national security threat. Some of the U.S. scientists profiled in the report also had sponsorship deals with Huawei that predated the company’s classification as a national security threat.
The general response from Huawei and Optica has been that the titanic Chinese corporation was sincerely interested in sponsoring cutting-edge research, and the American foundation took the money without realizing how alarming its connections to Huawei might appear. Optica representatives ascribed the failures of disclosure described by Bloomberg as carelessness, rather than deliberate efforts to conceal ties to a Chinese Communist entity.
Bloomberg seemed unconvinced, noting that Optica may yet be prosecuted under the False Claims Act for “causing researchers to file fraudulent information to the U.S. government regarding their sources of funds” by concealing Huawei’s involvement from them.
