We’ve seen economic espionage in spy novels containing intrigue and mystery. We've also seen it in James Bonds films with a suave hero rooting out foreign evil-doers and in Mission Impossible storylines, saturated with complicated international criminal syndicates attempting to steal trade secrets from the United States. Economic espionage has been the intrigue of pop culture since the Cold War and beyond. But what does espionage really mean? Is it a clandestine, foreign-sponsored plot? Is there really a Tom Cruise-like character investigating all the ways foreign entities attempt to ravage the U.S. government or U.S. corporations of proprietary information? Partially, yes.
While corporate espionage can cause significant financial losses to businesses across the country, pinning down the exact actions that cause a person to be in violation of the law is a little more challenging. Let’s explore economic espionage below by looking at the federal law prohibiting it, real-life examples, and what to do if you’ve been charged with a crime against the government.
Economic Espionage Defined
The federal government criminalizes economic espionage via 18 U.S.C. § 1831. Under this statute, a person is in violation of the law if the prosecutor can prove beyond a reasonable doubt that:
- A person(s) stole or, without authorization of the owner, obtained, destroyed or conveyed information;
- That person knew this information was proprietary;
- The information was in fact a trade secret; and
- The defendant knew the offense would benefit or was intended to benefit a foreign government, foreign instrumentality, or foreign agent.
The goal of economic espionage actors is to save a company the money it would typically spend on research and development by just copying the processes of proven methods of production. Those convicted under this statute face fines up to $500,000 per offense and imprisonment of up to 15 years for individuals, and fines of up to $10 million for organizations.
Example of Corporate Espionage
The FBI has stated that economic espionage is on the rise, seeing a 53 percent increase in these cases against U.S. companies leading to the loss of hundreds of billions of dollars in 2015 alone. Let’s look at one example. Imagine spies targeting a computer widget manufacturer hoping to gain an edge in their market by stealing manufacturing techniques to make the company more efficient. Foreign nationals physically break into the computer plant, taking pictures and videos of the widget company’s proprietary information and immediately send it back to their country of origin in hopes to recreate the technology without having to pay for all the research costs.
In another case, a Boston man was convicted on a charge of foreign economic espionage for providing trade secrets to an undercover federal agent posing as an Israeli intelligence officer.
Theft of Trade Secrets: A Companion Charge
Economic espionage looks an awful lot like another crime: theft of trade secrets. Theft of trade secrets occurs when someone knowingly steals or misappropriates a trade secret for the economic benefit of anyone other than the owner. In order to qualify as a trade secret, the information must not be generally known or reasonably ascertainable by others. Theft of trade secrets carries a lesser penalty than economic espionage with up to 10 years in federal prison for individuals and fines of up to $5 million for organizations.
Economic Espionage: Additional Resources
- The Company Man: Protecting America’s Secrets (FBI crime awareness video)
- Protecting Your Company’s Trade Secrets
Next Steps: Free Federal Criminal Defense Attorney Case Review
You may not be the star in the next "Mission Impossible" installation, but you can still be the star in a real-life prosecution for economic espionage or a variety of other crimes against the government. If you are being accused of a federal crime, be smart and get the best possible defense available. Have a skilled federal criminal defense lawyer review your case for free and at no obligation to you and then decide your next move.