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FBI Arrests Apple Secrets Thief While Leaving for China

Former employee had been hired by XMotors.

by on Jul.11, 2018

CEO Tim Cook has been coy about Apple's self-driving car program, but it was the victim of proprietary information theft.

In what looked like something out of a James Patterson novel, FBI agents swooped in and arrested a former Apple employee who was boarding a plane for China after earlier swiping a passel of corporate secrets about Apple’s autonomous vehicle technology.

Xiaolang Zhang was a person of interest in an investigation about the theft of information from Apple by the FBI. He had already interviewed several times by Apple.

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He booked a last-minute flight to China on July 7, and then was arrested at the San Jose International Airport by FBI agents. Zhang has been charged with theft of trade secrets, according to a criminal complaint filed Monday in federal court in San Jose.

Zhang was hired in December 2015 to work on Apple’s autonomous vehicle project. He took paternity leave during April and traveled with his family to China, according to the complaint.

(Apple raises profile in race for autonomous vehicles with Waymo exec hire. Click Here for the story.) 

A sketch of a possible Apple Car interior helped illustrate the tech giant's patent application.

When he returned in late April, Zhang resigned telling his superior he was moving back to China to be closer to his mother who was in poor health. He also said he planned to work for XMotors, a Chinese autonomous and electric vehicle startup, which has offices in Silicon Valley, USA Today reported.

That got the attention of Apple officials, who began checking Zhang’s two company phones and computer for any irregular activity or contacts. They found that Zhang downloaded confidential technical documents about autonomous car prototypes, and then he downloaded those onto his wife’s laptop.

According to the complaint, the company reviewed surveillance footage and badge swipe records and discovered Zhang entered Apple’s autonomous vehicle labs on April 28 and left with a keyboard, cables and a large box — while he was supposed to be on maternity leave.

In a later interview with Apple officials, Zhang admitted to seeking a job with XMotors while being in the employ of Apple. Zhang told investigators he downloaded the data to study it on his own and admitted to being shown a proprietary chip by Apple colleagues during a visit on April 28.

(Click Here for more about Volkswagen supplying vehicles for Apple’s AV program.)

After the interview, Zhang brought Apple investigators a Linux server and circuit boards he took from the lab, as well as his wife’s laptop, which he denied forwarding any data from.

Apple asked for and received permission to test autonomous vehicles in California.

Apple, in turn, informed the FBI about the data taken, which included a 25-page document containing electrical schematics for a circuit board used in Apple’s autonomous vehicle project, according to the complaint.

During a July 27 interview with the FBI, Zhang repeated everything he told Apple. When the agency learned that Zhang planned to fly to Beijing, with a final destination of Hangzhou, China on Hainan Airlines, the FBI apprehended him at the airport as he passed through a security checkpoint, the complaint said.

Apple “takes confidentiality and the protection of our intellectual property very seriously,” the company said in a statement to USA Today. “We’re working with authorities on this matter and will do everything possible to make sure this individual and any other individuals involved are held accountable for their actions.”

(To see more about Apple’s first piece inside its self-driving car program, Click Here.)

XMotors said it has not gotten any Apple trade secrets from Zhang and is compliant with the laws of China and the U.S. Isabel Jiang, XMotors spokesperson, told Bloomberg that it takes the protection of intellectual property rights seriously.

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