Reuters: “A Chinese state-security official arrested this year on allegations of spying for Washington is suspected to have compromised some of China’s U.S. agents in a major setback that angered President Hu Jintao, sources said.
Hu personally intervened this year, ordering an investigation into the case after the Ministry of State Security arrested one of its own officials for passing information to the Americans, two sources with direct knowledge of the matter said.
The official, an aide to a vice minister, was taken into custody sometime between January and March after the ministry became alarmed last year over repeated incidents of Chinese agents being compromised in the United States, they said.
The ministry’s own investigations found the aide had been working for the Central Intelligence Agency (CIA) for years, divulging information about China’s overseas spy network in the nation’s worst espionage scandal for two decades, they added.
The sources’ comments represent the first confirmation that overseas Chinese espionage was deemed to have been damaged by the security breach, which has been kept quiet by both Beijing and Washington. Reuters first reported it on June 1.”