A backpack of cash left in a locker at a recreation center in Livermore, California, photographs taken inside a Navy recruiting station in Southern California, and a phone passed hand to hand that the man who received it called a "state secret."
Those details come from the court record in a case that closed last week, when two Chinese nationals were sentenced in federal court in the Northern District of California for working as agents of the Ministry of State Security, China's main civilian intelligence service.
Liren "Ryan" Lai, 40, and Yuance Chen, 39, each received 30 months in prison and three years of supervised release.
Both had pleaded guilty, Lai in December 2025 and Chen in February.
What the record describes
The two began acting for the MSS no later than May 2021, according to the Justice Department's account of the court documents. Lai recruited Chen and at first passed instructions between Chen and MSS officers, and Chen later took assignments from the officers directly.
In January 2022, while both men were in China, they coordinated with people in the United States to leave a backpack holding roughly $10,000 in cash in a locker at a recreational facility in Livermore. That kind of arrangement, a dead drop, moves money or documents without the two sides meeting.
From 2022, Chen collected information on military installations and personnel. He obtained photographs of Navy Base Kitsap in Bremerton, Washington. He also took photographs and video of recruits and active-duty sailors inside a Navy recruiting station in Southern California. He also gathered identifying details about a Navy employee and kept biographical files on service members who were potential targets for recruitment.
Lai flew to the United States in March 2023 to hand Chen a phone for covert contact with the MSS. Chen traveled to China in 2024 and again in 2025 to meet MSS officers and collect new assignments. In April 2025 Lai returned to the United States, and the following month the MSS sent him to Phoenix to arrange another cash handover of about $20,000.
The FBI arrested both men on June 27, 2025, in what the department describes as a coordinated counterintelligence operation, and a grand jury in the Northern District of California indicted them four days later on two counts each, conspiring to act as an agent of a foreign government without prior notification to the Attorney General and acting as one.
The charge is narrower than espionage
Neither man was charged with espionage. The offense here is acting as an agent of a foreign government without notifying the Attorney General first, which carries up to 10 years in prison. The statute defines such an agent as someone who agrees to operate inside the United States under the direction or control of a foreign government, and it carves out accredited diplomats and publicly acknowledged representatives.
Prosecutors reach for that provision when someone works for a foreign service without the cover of a declared diplomatic post. It does not require proof that classified information changed hands. That is how conduct built out of dead drops and surveillance of a Navy base ended in 30 months against a statutory maximum of 10 years.
Who worked the case
The FBI's San Francisco field office led the investigation. Three other field offices assisted, in Portland, Houston and San Diego, along with the Naval Criminal Investigative Service. The National Security Division's Counterintelligence and Export Control Section prosecuted alongside the U.S. Attorney's Office for the Northern District of California.
Assistant Attorney General for National Security John A. Eisenberg called the activity "extensive and brazen." Roman Rozhavsky, who heads the FBI's Counterintelligence and Espionage Division, said the two had carried out "clandestine intelligence work that included making covert payments, collecting sensitive military information, and attempting to recruit American service members."
