US officials have long warned that Chinese intelligence services target American companies, especially those with valuable technology, and that businesses need to do more to protect themselves.
“It takes a disaster for people to realize that a little bit of training could have mitigated the risk,” said Michele Rigby Assad, a former undercover CIA intelligence officer who now trains companies to recognize foreign intelligence threats.
Assad served in the CIA from 2002 to 2012, including overseas assignments in counterterrorism and counterintelligence. She now works as a corporate counterintelligence trainer and international-security consultant, including on Chinese intelligence operations in Florida.
Her warning comes as Nvidia’s board investigates whether CEO Jensen Huang was the target of a foreign intelligence effort — a case unfolding amid longstanding FBI warnings about China’s espionage threat to US companies and technology.
In 2020, then-FBI Director Christopher Wray said the bureau was opening a new China-related counterintelligence case about every 10 hours, and that nearly half of its roughly 5,000 active counterintelligence cases were China-related.
More recently, the FBI said it had helped facilitate 62 removals of foreign intelligence threats through its China program this year.
That broader threat is the context for the questions now facing Nvidia.
Megaspeed, an Nvidia customer, has separately faced scrutiny over whether it helped Chinese customers access advanced chips restricted by US export controls. Nvidia said it has no reason to believe national security or company secrets were compromised, and said it found no evidence Megaspeed illegally transferred its products.
Assad told Business Insider in September that there are “far more Chinese operations going on against us in the United States” than there are FBI agents to pursue them.
In a Tuesday follow-up, Assad said that leaders of strategically important companies may underestimate the possibility that personal relationships can be exploited for intelligence purposes. Given Nvidia’s central role in the US-China competition over AI, she said, reports that Huang may have been targeted did not surprise her.
Assad did not assess the evidence in Nvidia’s investigation or say what Huang knew about the relationship. Nvidia has not said Huang shared company information or that Alice Huang was involved in a foreign intelligence operation. China has denied the espionage allegations.
What companies should take from the Nvidia case
Assad said companies should assume that valuable technology can attract foreign interest.
“If you have products that are of interest to the Chinese and you’ve spent millions or billions of dollars developing that product, you are a target,” she said. “It’s so much easier for the Chinese to steal those secrets, product designs, etc. than it is to spend billions of dollars trying to engineer what you’ve already developed.”
She added that the business community needs to take counterintelligence risks more seriously, particularly companies with technology, products, or data that may be valuable to foreign governments.
“Counterintelligence training for the private sector should be a priority, so that people understand the risk and know what an intelligence operation looks like in real life,” Assad said.
She added that companies need to “train ourselves out of the optimism bias that causes us to put on rose-colored glasses and not see what’s happening in front of our faces.”
Federal counterintelligence officials have issued similar warnings to businesses. The FBI says counterintelligence risks often resemble ordinary business interactions, such as a “too perfect” investor, recruiter, or customer request, a new hire seeking unusual access, or a friendly contact who gradually asks for more information.
How people can become sources
Assad said recruitment can begin with something as ordinary as an invitation to speak at a conference.
“Oftentimes experts are invited to speak or give a presentation at a conference in China,” she said. “Then, Chinese contacts who develop a friendship with you, will start asking you for reports/insights that they pay you for.”
Those contacts can continue requesting additional reports and more sensitive information, she said.
“People tend to get caught up in the ease with which they get paid for work that feels natural or with minimal risk,” Assad said. “They identify your vulnerabilities, and they play on those weaknesses.”
Assad said those vulnerabilities can determine whether an intelligence service uses financial incentives or “insert a honeytrap into your social circle if you’re lonely, feel unappreciated, etc.”
“The use of honeypots in intelligence is a tale as old as time,” she said.
A gap in training
Assad said companies in strategically important industries generally do not receive enough training on foreign intelligence risks.
She pointed to Florida’s Space Coast, which is working on sensitive technology and development projects.
Assad said she and her husband once saw people in a Cocoa Beach bar whom they believed were Chinese operatives “working the room,” using tactics she recognized from her own intelligence work overseas. Business Insider has not independently verified that observation.
“We have engineers and people involved in secret developmental efforts that cost billions of dollars for our companies,” Assad said. “And the Chinese have operatives crawling up and down.”
That concern is consistent with a 2023 federal advisory reported by MarketWatch, which warned that foreign intelligence entities were seeking sensitive technology and data from commercial space companies, including SpaceX and Blue Origin.
Assad said she has offered free counterintelligence training to companies and business networks in the region but has not been taken up on the offer.
