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Lucent workers busted for inside tech swindle

Selling US trade secrets to China -- again

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Internet Security Threat Report 2014

The FBI on Thursday nailed three Chinese nationals -- two Lucent Technologies scientists and a hanger-on -- on charges of forming a company called ComTriad Technologies through which they sold Lucent trade secrets to a Chinese outfit they formed with a commercial cabal of Beijing plutocrats known as Datang Telecom Technology.

The Lucent scientists, Hai Lin and Kai Xu, and their collaborator Yong Qing Cheng, were arrested at home, the FBI says.

The Lucent Lads had been working on PathStar, the company's outdated, low-budget Internet voice and data service.

The three formed a joint venture with the Chinese company to market PathStar, dreaming that they'd become "the Cisco of China," according to the Associated Press.

The unlucky crew face penalties of five years in the slam and fines of $250,000, according to court documents. US Magistrate Judge Stanley Chesler denied them bail, wisely noting that they posed a significant flight risk.

The accused transferred data earlier this year to Datang for use in developing a ComTriad system - the CLX 1000 - that was identical to Lucent's PathStar Server, the complaint says.

"A substantial amount of the source code....has been transferred" to China, the AP quotes Assistant US Attorney Scott Christie as saying.

"They were ready to roll out with it in September of this year," US Attorney Robert Cleary noted.

The three had planned for the joint venture to issue stock both in China and the United States, the FBI said.

Lucent spokesman Bill Price said the company "notified [the FBI] as soon as we became aware of the activities and have been assisting them in the investigation."

Price insisted that Lucent's decision early this year to discontinue PathStar had nothing whatever to do with the theft. ®

Internet Security Threat Report 2014

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