By Ann M. Simmons; Los Angeles Times:
The financial giant Anbang Insurance Group Co. announced Wednesday that its chairman, Wu Xiaohui, was stepping aside temporarily for “personal reasons” and that he had authorized “relevant senior executives to continue running the business.”
The announcement, which spurred a decline in stocks in which Anbang has significant investment, came just hours after the independent Chinese financial magazine Caijing reported that authorities had detained Wu.
The story was later deleted from the magazine’s website, but the BBC reported that police had taken Wu away from the Anbang offices in Beijing on Thursday.
The global insurance company, which acquired the Waldorf Astoria New York hotel in 2014, is one of the largest insurance groups in China, according to its website. A short statement from the company did not address the magazine story or indicate how long Wu might be gone.
But his abrupt departure doesn’t come as a total surprise. In recent years, dozens of senior executives have mysteriously vanished. Most are believed to have been caught up in an aggressive anti-corruption campaign that has targeted financial industry executives, government officials and the heads of state-owned companies.
In many cases, the disappeared have returned. In others, they have turned up in custody or were found dead.
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Make No Mistake, the Intelligence Compromise in China is a Big Deal
By Luis Rueda; OpsLens:
Recent reporting by the New York Times highlighted a 2010-2012 compromise of US intelligence sources inside China. According to the Times, as many as 20 sources were compromised, leading to their incarceration or execution. A lengthy counterintelligence (CI) investigation named Honey Badger could not clearly identify a cause for the compromise. The speculation centered on the compromise of communications systems (covert communications, or COVCOM), poor tradecraft on the part of operations officers in Beijing, or an inside traitor.
This is truly devastating news. It takes a lot of time to build up sufficient sources inside a denied area, like China, to provide the US government with adequate intelligence information. It is unlikely that we have recovered that coverage in the intervening time since the compromise. At a time when China has become more aggressive, more of a national security threat, we have gone blind on intelligence coverage of China.
Intelligence operations are an inherently risky proposition in general, and denied areas like Beijing, Moscow, or Havana are even more so. It is not uncommon, when faced with a pervasive CI service such as the Chinese have, to experience an operational compromise every now and then for a variety of reasons, but the compromise of what appears to be the entire network is a major tragedy, both in terms of intelligence coverage and human life.
The possible compromise of COVCOM is a tradecraft issue. The Chinese should not have been able to compromise everyone via penetrating their COVCOM, since the sources should have been on multiple COVCOM systems in order to prevent just such a compromise. If the Chinese were able to compromise all these sources through their COVCOM, then the CIA was practicing very poor tradecraft indeed. It means all these sources were on the same or very similar COVCOM to the point of allowing the Chinese to wrap everyone up. This is just lazy and sloppy.
The Times noted that one possibility was poor tradecraft inside Beijing by CIA officers, such using a restaurant for meetings over and over again, allowing the Chinese to monitor the meetings via audio devices, and Chinese security officers posing as waiters. If this was the case, then shame on the CIA for allowing such poor tradecraft inside a very threatening CI environment. Individuals should be held accountable for such sloppy tradecraft.
Regarding the insider threat situation, we face a totally different animal. This is a threat that is extremely difficult to counter, and we seldom find out about it until we start losing intelligence collection capabilities—in this case, we start to lose people. We should not be surprised if there was a mole inside the CIA, given Russia’s success at recruiting sources inside the US intelligence community (IC) over the years. China should not be far behind the Russians on successfully penetrating the CIA, FBI, and other IC organizations.
The Times mentioned an officer involved in Chinese operations as a suspect in the compromise. I hesitate to point out anyone as a possible traitor given the careers that have been ruined over false allegations of working for the Soviets over the years. However, there should be a system in place whereby officers involved in sensitive, denied area operations are given greater scrutiny. They should undergo more frequent polygraphs and more frequent investigations into their finances and travel as a means of identifying potential CI threats.
Let no one doubt this—the compromise of China sources is a major blow to our intelligence abilities and our ability to answer questions the administration needs to know when making Chinese policy.
