Whistleblower Alleges DC Nonprofit Helped Funnel Pentagon-Funded Research To Blacklisted Chinese Company

A whistleblower employee at a Washington, D.C.-based nonprofit alleged in a complaint that the organization “willfully” funneled Pentagon-funded research to a blacklisted Chinese company, Bloomberg reported on Tuesday.

Huawei, a Chinese telecommunications giant, quietly provided funding to the nonprofit organization Optica for a contest for researchers, according to Bloomberg. Several of the contenders had also received funding grants from the Pentagon and the Defense Advanced Research Projects Agency (DARPA) to research sensitive military technologies, and Huawei’s secret involvement in the contest put that research in the hands of the company and by extension the Chinese Communist Party (CCP), the whistleblower alleges.

“I believe that research that is funded by DARPA and other agencies and patents to which the U.S. government has certain rights have been willfully exported to Huawei and therefore the Chinese government” through the contest, the whistleblower’s complaint that was filed with Optica’s general counsel alleges, Bloomberg reported.

The U.S. initially blacklisted Huawei in 2019 and issued another ban for its newest telecommunications equipment in 2022 over concerns that the company installed hardware and software that could be used to spy on Americans. As a China-based company with “close ties” to the CCP and Beijing’s “military and intelligence apparatus,” Huawei “is susceptible to Chinese government pressure” to commit cyber espionage, according to the Federal Communications Commission (FCC).

An Optica spokesman also told Bloomberg that it was “simply incorrect” that Optica had jeopardized defense-funded research and that “no research has ever been provided by or through Optica to Huawei or any government entity.”

Some of the contenders had received grants from defense agencies around the same time Huawei funded them through the Optica competition, according to government and university announcements reviewed by Bloomberg. The contenders were selected for the grants to research computer chip technology by DARPA, thermal emissions by the Office of Naval Research’s Sea Warfare and Weapons Department and AI systems under the CHIPS and Science Act.

As the contest was being run by Optica, the contenders weren’t aware they had accepted money from Huawei, according to Bloomberg. Optica returned the funds to Huawei after revelations of the blacklisted company’s involvement were reported publicly.

A Huawei executive was also one of the judges in the contest hosted by Optica, according to an agreement document reviewed by Bloomberg. Winners in the contest were obligated to participate in a minimum of two meetings with Huawei’s representative; they also had the option of traveling to Beijing for an annual technology event co-hosted by Huawei, according to an internal Optica document reviewed by Bloomberg.

Optica’s choice to secretly allow Huawei to be the sole funder of the contest and let the blacklisted company gain access to the contenders undermines U.S. government policies meant to protect national security and taxpayer dollars, research security specialists told Bloomberg.

Huawei’s relationship with Optica began “decades” ago, Optica’s CEO, Elizabeth Rogan, said during a March 2022 meeting, according to meeting minutes reviewed by Bloomberg. When asked for additional information, an Optica spokesperson told Bloomberg that Rogan and her team had traveled to China to visit Huawei in 2007, and Rogan built a relationship with the Huawei executive who was a judge on the contest.

The whistleblower raised concern that Rogan made an “undisclosed” visit to Huawei in November during a trip to China, according to the complaint reviewed by Bloomberg. An Optica spokesman told Bloomberg that it was “an informal courtesy stop at the end of a two-week trip” and Rogan had “already sent two internal communications about trip highlights and a third felt excessive at the time.”

Optica and Huawei did not immediately respond to a request for comment.

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