Hayward man sentenced for smuggling data
A Hayward man was sentenced to four years in federal prison Tuesday for smuggling purported national security information to China for more than two years.
Prosecutors said the smuggling carried out by Xuehua “Edward” Peng was actually managed by an undercover agent using classified data that the U.S. government had decided could be safely released. But U.S. Attorney David Anderson said Peng “will now spend years in prison for compromising the security of the United States.”
Peng, 56, entered the U.S. from China on a business visa in 2001 and became a U.S. citizen in 2012. He ran a travel business for Chinese visitors before his arrest in Septem
ber.
According to an FBI affidavit, a confidential U.S. source met in 2015 with officers of China’s Ministry of State Security and offered to supply classified information through a California man who had family and business dealings in China.
The source proceeded to leave digital devices containing secret information in hotel rooms, usually taped to a dresser, the affidavit said. It said Peng got a key to the room from the front desk, picked up the device and left an envelope of $10,000 or $20,000 in cash, a total of $70,000 in five drops. He then flew to China and handed over the devices.
The first two dropoffs were at hotels in Newark in October 2015 and Oakland in April 2016, and the last three were in Columbus, Ga., between July 2017 and June 2018, the affidavit said. It said another dropoff was planned for the Bay Area before Peng was arrested.
Peng pleaded guilty in November to a felony charge of acting as a foreign agent. He was sentenced Tuesday by U.S. District Judge Hayward Gilliam of Oakland under a plea agreement that also included a $30,000 fine.
His lawyers, Edward Swanson and Mary McNamara, were not immediately available for comment. In a court filing, they described Peng as “a simple man who was recruited by sophisticated foreign agents” who had no criminal record, lived with his wife and two young daughters, and “deeply regrets his actions” in the case.