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Secretive Chinese Firms Target Laid-Off U.S. Workers for Recruitment

3/25/2025
A network of Chinese-operated companies is attempting to recruit recently laid-off U.S. government employees, raising concerns about espionage and foreign influence in the workforce. Analysts warn of potential risks as these firms utilize deceptive tactics to target vulnerable individuals.
Secretive Chinese Firms Target Laid-Off U.S. Workers for Recruitment
Chinese firms are allegedly recruiting laid-off U.S. government workers, raising alarms about espionage tactics targeting vulnerable employees.

Recruitment Scandal: Secretive Chinese Tech Firm Targets Laid-Off U.S. Workers

On March 25, a disturbing report emerged revealing that a network of companies, allegedly linked to a secretive Chinese tech firm, has been attempting to recruit recently laid-off U.S. government workers. This information comes from job advertisements and research conducted by Max Lesser, a senior analyst at the Washington-based think tank, Foundation for Defense of Democracies.

Unveiling the Recruitment Network

Lesser's investigation indicates that the recruitment ads are part of a larger scheme involving fake consulting and headhunting firms specifically targeting former government employees and AI researchers. The details regarding the four companies connected to this network remain scant, but evidence suggests they share overlapping websites, are hosted on the same server, and display other digital connections.

Interestingly, all four companies' websites are hosted at the same IP address alongside Smiao Intelligence, an internet services company. However, during the reporting process, Smiao Intelligence's website became unavailable, raising questions about its relationship with the other companies. Attempts by Reuters to investigate further led to numerous dead ends, including unanswered phone calls and fake addresses.

Exploiting Financial Vulnerabilities

According to Lesser, this recruitment campaign mirrors established tactics used in prior Chinese intelligence operations. The significance of this activity lies in its objective to exploit the financial vulnerabilities of former federal workers affected by recent mass layoffs. While Reuters could not confirm any direct links between the companies and the Chinese government, intelligence analysts suggest that this network exemplifies how foreign-linked entities seek to gather sensitive information from recently terminated government staff.

Once hired by these companies, former federal employees may be coerced into sharing sensitive government information or even recommending other potential targets. A spokesperson for the Chinese Embassy in Washington denied any knowledge of the entities involved and emphasized that China respects data privacy and security. Conversely, a White House spokesperson warned that China consistently exploits the U.S. free system through espionage, urging both active and former employees to remain vigilant.

Profiling the Companies

Among the companies implicated in this scheme is RiverMerge Strategies, which positions itself as a geopolitical risk consulting firm. The company had posted two job listings on LinkedIn earlier this year, one seeking a Geopolitical Consulting Advisor and the other for a human resources specialist. However, both listings have since been deleted. The U.S. contact number for RiverMerge is now out of service, and an overseas number listed on their site is linked to another Chinese company, Shenzhen Si Xun Software Co., Ltd.

Further investigations revealed that the addresses listed for RiverMerge in Singapore and Colorado were either nonexistent or tied to unrelated businesses. An anonymous source claiming to be an employee of RiverMerge indicated that they were being paid to promote job listings, raising further questions about the legitimacy of the recruitment efforts.

Continued Deceptive Practices

Another company, Wavemax Innovation, also attempted to recruit recently laid-off U.S. government employees through an ad on Craigslist. The ad sought candidates with diverse skills, but its authenticity remains unverified. When Reuters visited the listed Singapore address, only a vacant field was found, and corporate registry searches yielded no results.

LinkedIn has acknowledged its efforts to eliminate fraudulent activity on its platform, confirming that RiverMerge’s profile is currently restricted. Moreover, an FBI spokesperson cautioned that Chinese intelligence officers often masquerade as consultants or recruiting firms to target U.S. government employees, echoing tactics used in past espionage cases.

Conclusion

This ongoing situation highlights the significant risks posed by foreign intelligence operations, particularly for U.S. government workers transitioning to new employment. As the landscape of employment for federal employees evolves, it becomes increasingly crucial for them to recognize potential threats and safeguard sensitive government information against deceptive recruitment practices.

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