BOSTON — Michigan State University President Lou Anna Simon contacted the Central Intelligence Agency in late 2009 with an urgent question.

The school’s campus in Dubai needed a bailout and an unlikely savior had stepped forward: a Dubai-based company that offered to provide money and students.

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Michigan State University President Lou Anna Simon learned to be wary of front companies by serving on the National Security Higher Education Advisory Board, established by the FBI and CIA, which “makes you more aware that you need to look below the surface of some of these offers.” Kurt Stepnitz/Michigan State University via Bloomberg

Simon was tempted. She also worried that the company, which had investors from Iran and wanted to recruit students from there, might be a front for the Iranian government, she said. If so, an agreement could violate federal trade sanctions and invite enemy spies.

The CIA couldn’t confirm that the company wasn’t an arm of Iran’s government. Simon rejected the offer and shut down undergraduate programs in Dubai, at a loss of $3.7 million.

SECURITY OFFICIALS ALARMED

Hearkening back to Cold War anxieties, growing signs of spying on U.S. universities are alarming national security officials.

As schools become more global in their locations and student populations, their culture of openness and international collaboration makes them increasingly vulnerable to theft of research conducted for the government and industry.

“We have intelligence and cases indicating that U.S. universities are indeed a target of foreign intelligence services,” Frank Figliuzzi, FBI assistant director for counterintelligence, said in a February interview at Washington headquarters.

While overshadowed by espionage against corporations, efforts by foreign countries to penetrate universities have increased in the past five years, Figliuzzi said. The FBI and academia, which have often been at loggerheads, are working together to combat the threat, he said.

Attempts by countries in East Asia, including China, to obtain classified or proprietary information by “academic solicitation,” such as requests to review academic papers or study with professors, jumped eightfold in 2010 from a year earlier, according to a 2011 U.S. Defense Department report. Such approaches from the Middle East doubled, it said.

“Placing academics at U.S. research institutions under the guise of legitimate research offers access to developing U.S. technologies and cutting-edge research” in such areas as information systems, lasers, aeronautics and underwater robots, the report said.

Welcoming world-class talent to American universities helps the U.S. sustain global supremacy in science and technology, said University of Maryland President Wallace Loh. He chairs the Department of Homeland Security’s academic advisory council, which held its first meeting March 20 and is expected to address such topics as federal tracking of international students.

Foreign countries “can never become competitive by stealing,” he said. “Once you exhaust that technology, you have to start developing the next generation.”

Foreigners on temporary visas made up 46 percent of science and engineering graduate students at Georgia Institute of Technology and Michigan State and 41 percent at Massachusetts Institute of Technology in 2009, according to a federal survey.

China sent 76,830 graduate students to U.S. universities in 2010-2011, more than any other country and up almost 16 percent from the prior year, according to the Institute of International Education in New York.

While most international students, researchers and professors come to the U.S. for legitimate reasons, universities are an “ideal place” for foreign intelligence services “to find recruits, propose and nurture ideas, learn and even steal research data, or place trainees,” according to a 2011 FBI report.

In one instance described in the report, the hosts of an international conference invited a U.S. researcher to submit a paper. When she gave her talk at the conference, they requested a copy, hooked a thumb drive to her laptop and downloaded every file.

In another, an Asian graduate student arranged for researchers back home to visit an American university lab and take unauthorized photos of equipment so they could reconstruct it, the report said.

U.S. STUDENTS OVERSEAS TARGETED

More Americans are heading overseas for schooling, becoming potential targets for intelligence services, Figliuzzi said. More than 270,000 Americans studied abroad for credit in 2009- 2010, up 4 percent from the year before.

President Obama has announced an initiative to send 100,000 American students to China, and China has committed 10,000 scholarships for them.

As a junior at Grand Valley State University in Allendale, Mich., Glenn Duffie Shriver studied at East China Normal University in Shanghai.

After graduation, he fell in with Chinese agents, who paid him more than $70,000. At their request, he returned to the United States and applied for jobs in the State Department and the CIA.

He was sentenced to four years in prison in January 2011 after pleading guilty to conspiring to provide national-defense information to intelligence officers of the People’s Republic of China.

“Study-abroad programs are an attractive target. Foreign security services find young, bright U.S. kids in science or politics; it’s worth winning them over,” Figliuzzi said.

Unlike its counterparts in other countries, which rely on their own operatives, China’s intelligence service deploys a freelance network including students, researchers and false-front companies, said former FBI official David Major, president of the Centre for Counterintelligence and Security Studies in suburban Washington.

China has “lots of students who either are forced to or volunteer to collect information,” he said. “I’ve heard it said, ‘If it wanted to steal a beach, Russia would send a forklift. China would send a thousand people who would pick up a grain of sand at a time.’ “

China also has more than 3,000 front companies in the U.S. “for the sole purpose of acquiring our technology,” former CIA officer Eugene Poteat, president of the Association of Former Intelligence Officers in suburban Washington, wrote in the fall/winter 2006-2007 edition of Intelligencer: Journal of U.S. Intelligence Studies.

The Chinese embassy in Washington and the Ministry of Foreign Affairs in Beijing didn’t respond to emailed questions.

SAFEGUARDING ACADEMIC FREEDOM

Michigan State’s Simon learned to be wary of front companies by serving on the National Security Higher Education Advisory Board, established by the FBI and CIA in 2005.

It “makes you more aware that you need to look below the surface of some of these offers,” she said. “A short-term solution may turn into an institutional embarrassment.”

University administrators have traditionally viewed their role as safeguarding academic freedom and making sure that all students, domestic or foreign, are treated the same.

Some faculty members remain uneasy about a partnership with federal investigators.

“The FBI thrives on a certain degree of paranoia, and it operates in secrecy,” said David Gibbs, a history professor at the University of Arizona. “The secrecy goes against so much of what universities are about, which is openness and transparency.”

Stanford University avoids seeking contracts for “export-controlled” research, which only Americans can work on without a license because it has implications for economic or national security.

“Stanford does not, nor will it, restrict participation of students on the basis of citizenship,” President John Hennessy testified at a January 2010, congressional hearing in Palo Alto, Calif. More than half of Stanford’s doctoral candidates in the physical sciences and engineering come from outside the U.S., he said.

Asked by Rep. Dana Rohrabacher, R-Calif., if he had read that Chinese military intelligence uses Chinese students, Hennessy said, “I am aware of that.”

“Universities need to think that they are patriotic Americans, too,” Rohrabacher responded.

Hennessy is on sabbatical and unavailable to comment, said Lisa Lapin, a Stanford spokeswoman.

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