California Man Pleads Guilty to Being Chinese Agent; Court Denies Him Plea Deal

California Man Accused of Spying for China’s Security Service Pleads Guilty Monday

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A former California tour operator who is accused of being an agent for China’s security service pleaded guilty Monday, hoping to get a reduced prison sentence.

57-year-old Xuehua Edward Peng agreed to serve four years in prison and pay a fine of $30,000 in a plea deal that was negotiated with prosecutors after they charged him with acting as an illegal foreign agent who delivered U.S. national security information to Chinese government officials.

His plea deal was, however, declined by U.S. District Judge Haywood S. Gilliam Jr. and, therefore, he will have to wait until his sentencing, which is scheduled for March.

Peng, a naturalized U.S. citizen, and who has been in custody since late September, appeared in court Monday and told the judge he understood the terms of the agreement and that he was guilty.

According to prosecutors, Peng was under orders from a handler in China to leave cash in hotel rooms in exchange for classified national security information. They argued the U.S. was never at risk since the information was provided by an FBI double agent who had also been approached by the Chinese government to spy-work but informed the U.S. government instead.

In the plea deal, Peng told court that a state security official with the People’s Republic of China approached him during a business trip in 2015 and agreed to collect and deliver information. He added that he made six trips between 2015 and 2018, leaving as much as $20,000 in envelopes at a time.

The Justice Department said Peng was arrested in September during an FBI operation that targeted Chinese intelligence operatives in the U.S. who were delivering national security information to China.

Peng was also earlier on denied a federal lawyer and a bail by a magistrate judge who argued that he had too many assets and an apartment and a mistress in China.