University Failed to Disclose Research Funding From Chinese Big Tech, DOJ Alleges

The U.S. Department of Justice in Washington on June 20, 2023. Kevin Dietsch/Getty Images

The University of Maryland (UMD) will pay the federal government $500,000 after its researchers allegedly failed to disclose funding from Chinese tech giants on their proposals for federal research grants.

The settlement resolves allegations involving three faculty members at UMD’s flagship College Park campus, the U.S. Department of Justice said in a July 16 press release.

Federal prosecutors alleged that the researchers, who collectively received five federal research grants between 2015 and 2020, were also the principal investigators on projects funded by three Chinese companies: Huawei, Taobao, and Alibaba.

For Huawei, a smartphone and electric vehicle manufacturer whose ties with the Chinese military have triggered increasing scrutiny, the Maryland researcher was studying “high energy density FeF3 (iron fluoride) conversion cathode materials and Li (lithium) metal anodes,” according to the Justice Department.

For online retailer Taobao and its parent company Alibaba, the research projects were “large-scale behavior learning for dense crowds,” and “cyber-manufacturing of customized apparel.”

The foreign support the Maryland professors had sought and received was allegedly absent in their research grant proposals submitted to the National Science Foundation and the U.S. Department of the Army, according to the release.

Both federal agencies require grant applicants to disclose all current and pending support—foreign and domestic—received by their institution. They rely on the accuracy of these disclosures, in part, to avoid funding duplicative research projects and to make sure their highly competitive grants only go to those capable of performing the planned work.

“Complete and accurate disclosures are essential to federal agencies that make decisions on awarding federal grants,” U.S. Attorney Erek Barron of the District of Maryland said in the release. “Those individuals and universities that knowingly fail to do so skew the grant awarding process in their favor and will be held accountable.”

UMD Vice President for Research Gregory Ball said in a statement that the settlement is not an admission of wrongdoing by the public university or its faculty members.

“The University has consistently maintained, based on its own investigation and an independent investigation by outside counsel, that the nondisclosures were the result of good faith interpretations of agency disclosure guidance or unintentional clerical errors,” Mr. Ball said.

The settlement comes as the U.S. government and independent organizations continue to keep a closer eye on the three high-tech Chinese companies.

Taobao, the most popular e-commerce site in China, remains on the White House’s “Notorious Markets” list of businesses it believes have engaged in “substantial trademark counterfeiting or copyright privacy.”

Taobao’s owner Alibaba also gained notoriety in 2020, when researchers found that the facial recognition feature in Alibaba’s Cloud Shield service could be used to identify Uyghur people, potentially aiding the Chinese regime’s effort to reinforce social control of Uyghur Muslim communities.

“China users can simply send images of people, whether from phones or surveillance video, to the service, and if Alibaba suspects a Uyghur, it will flag the person,” said IPVM, a Pennsylvania-based research firm focusing on the surveillance industry.

Alibaba claimed that this feature was only used “within a testing environment,” but never explained why it was testing on Uyghur faces in the first place.

Huawei, meanwhile, has been effectively banned from conducting business in the United States since 2022 on national security grounds.