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Chinese intelligence is working the AI industry’s top floors. Tech companies aren’t prepared — and the FBI agents who should be watching have been sent elsewhere.
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IdeasBusinessJensen Huang’s spy scandal isn’t a one-offChinese intelligence is working the AI industry’s top floors. Tech companies aren’t prepared — and the FBI agents who should be watching have been sent elsewhere.
Source: Illustration by Moor StudioBusinessJensen Huang’s spy scandal isn’t a one-offChinese intelligence is working the AI industry’s top floors. Tech companies aren’t prepared — and the FBI agents who should be watching have been sent elsewhere.
By Roderick JonesPublished Nov. 14, 2026at6 a.m.Share
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Jensen Huang’s resignation from Nvidia after reports of an affair with an alleged Chinese spy is being treated as a one-off scandal. But it’s not. In the past year, my private security firm, which is staffed largely by former intelligence and law enforcement officers, has handled a number of cases in which senior executives at U.S. technology companies had relationships with women who we came to believe were working for Chinese intelligence.
The artificial intelligence industry has a security problem that it does not yet fully understand. U.S. companies are building technology with massive commercial and national security value, but their defenses against foreign intelligence are, in most cases, nowhere near good enough. At the same time, the FBI counterintelligence squads that should help protect these companies are badly understaffed; some agents have been reassigned to focus on the administration’s (opens in new tab) political priorities, while others have been purged (opens in new tab). The result is a widening gap between how much the technology matters and how well it’s being protected.
The FBI’s counterintelligence posture is an important part of this picture. NPR (opens in new tab)reported in October (opens in new tab) that in many of the bureau’s 56 field offices, counterintelligence squads are only 50%-60% staffed, as agents and analysts have been shifted toward fighting violent crime and enforcing immigration laws. The FBI disputes that this has weakened its counterintelligence operation. But it’s hard to believe these kinds of cuts haven’t affected China-focused efforts — and they come at a time when U.S. AI and AI-adjacent firms are more at risk from foreign interference than ever.
Investigating crime is important, but moving experienced personnel away from counterintelligence is a dangerous trade. Counterintelligence investigations are exceedingly complex and depend on accumulated knowledge and specialized judgment built over decades. That expertise is easy to lose and slow to rebuild. The history of intelligence shows that political purges take years to recover from.
After 9/11, for example, the FBI redirected large numbers of agents away from white-collar crime to counterterrorism. By the time the 2008 financial crisis hit, the bureau had fewer people to investigate mortgage and securities fraud — one reason so few of the people responsible ever faced charges.
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In this new environment, technology companies can’t assume that government agencies will spot a suspicious relationship or intervene before valuable information leaves the organization. They need their own insider-risk programs to recognize foreign interference and respond. But in my experience, much of the industry treats protection against espionage as an extension of conventional cybersecurity or physical security, rather than what it is: a distinct investigative discipline that must operate across the whole business, from the engineers writing code to the data centers and supply chains — and, as the Huang case shows, must reach all the way to the top.
OpenAI had some success this year when its internal teams found bugging equipment (opens in new tab)planted by a Saudi national; however, in most cases, the affected company either has no security team or has the wrong kind, and the warnings come from a worried colleague. That’s lucky, but not a sustainable defense.
One reason companies miss these operations is that foreign interference rarely feels urgent. A death threat creates an obvious reason to act. A relationship that gradually opens access to sensitive information can look ambiguous or commercially useful or be too uncomfortable to question. Executives may hesitate because they fear disrupting a commercial partnership or creating an internal controversy. To be blunt: Spies don’t often look like spies.
This is why board and executive attention matters. Security teams cannot manage risk if leadership treats it as peripheral. Companies need clear responsibility for assessing suspicious approaches, preserving relevant evidence, and deciding when an issue warrants investigation. They also need to accept that a credible inquiry may produce inconvenient findings. A security team that lacks authority to examine sensitive relationships will struggle, regardless of its budget.
The practical starting point for a company that suspects it may be the target of foreign interference is to commission an independent review through outside counsel, supported by experienced investigators. Done properly, with the work genuinely structured around legal advice, that arrangement can keep the findings privileged, which matters when the subject of the inquiry may be the company’s own leadership. The value lies in combining investigative competence with disciplined legal oversight.
Companies should also not assume that operations in the United Kingdom or European Union are inherently insulated from these risks. For a U.S. company, an overseas subsidiary or partner may become an indirect route to sensitive information. Security assessments therefore need to follow actual access across borders and corporate structures.
Ultimately, the AI boom has made American tech companies some of the world’s most valuable intelligence targets. Their defenses have failed to keep pace, and the government agencies that might have caught what the companies miss are looking elsewhere. Much has been made of the U.S. retreat from Europe’s defenses. Less noticed is the U.S. retreat from protecting its own technology companies.
Roderick Jones is executive chairman of Concentric, a San Francisco-based security firm. He began his career in Scotland Yard’s Special Branch.
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