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Judge revokes US citizenship of woman involved in data security breach

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Grace Li became a naturalized U.S. citizen in 2005. In 2009, she pleaded guilty to knowingly making false statements in her pursuit of citizenship.

Credit: Courtesy of Grace Li

A federal judge in Arizona has ordered the U.S. government to revoke the citizenship of a woman at the center of a 2007 security breach involving a Chinese national who worked inside an Arizona intelligence center.

U.S. District Judge David G. Campbell’s Aug. 26 order to strip Xunmei Grace Li, a Chinese native, of her naturalized citizenship came the same day that The Center for Investigative Reporting and ProPublica jointly reported the previously undisclosed security breach involving data at the Arizona Counter Terrorism Information Center.

The breach potentially exposed sensitive information in a state driver’s license database of up to 5 million Arizona residents. Li, 45, previously pleaded guilty to knowingly making false statements in her pursuit of gaining U.S. citizenship, which she obtained in 2005.

The immigration-related fraud case began soon after the disappearance of a Chinese national and computer programmer who worked at the intelligence center was reported to the FBI, according to the federal immigration agent who led the investigation.

Li did not respond to calls for comment. Her attorney, Don Bivens, wrote in an email that they believed the government was pursuing her unfairly for reasons they did not understand. Bivens declined to comment on whether Li plans to appeal the judge’s decision to strip her of her citizenship.

“It has been a shame to see the U.S. Department of Justice seeking to revoke citizenship from our client, who in our view simply made mistakes on her naturalization application that are commonly made by hundreds of immigrants every day,” he wrote.

Paul Haney, a retired U.S. Immigration and Customs Enforcement agent who investigated Li and Gang Chen, the father of Li's children, said the government had suspicions that Li was involved in espionage, and there were many unanswered questions about who she is, but the government erred on the side of caution.

“We may never know. Absent a confession, we can only speculate. Maybe she is telling the truth and she’s not an operative,” he said. “I don’t know.”

Li repeatedly has denied that she is a Chinese operative or spy.

Christopher Dempsey, a U.S. Justice Department attorney who represented the government at the trial, referred calls for comment to the Justice Department. Federal court records show Dempsey’s docket is filled with citizenship cases, including lawsuits tied to national security matters. In one ongoing case, Dempsey is working to denaturalize a Syrian native convicted of helping fund al-Qaida.

Justice Department spokeswoman Nicole Navas said the department was pleased with the court’s decision and Campbell’s order “speaks for itself.”

The court ruling followed a four-day bench trial in August that hinged on allegations of bigamy and whether Li lacked good moral character. Li was married to two men at the same time, but she contended that one of the marriages was intended to appease the parents of her children’s father and was not supposed to be real. The father, Chen, a onetime green card holder, was deported last year.

Li also did not list her two U.S.-born children on her naturalization application, an omission her attorneys argued was a simple and not uncommon mistake.

Campbell, who earlier this year partially ruled in Li’s favor, ordered denaturalization on four counts involving lack of good moral character. Those included false statements, bigamy, an extramarital affair and concealment or misrepresentation of facts to get citizenship. He wrote in his opinion that he came to doubt Li’s credibility during the trial.

“The government has shown that Li procured her citizenship by misrepresenting her marital status and concealing the existence of her children,” Campbell wrote.

Denaturalization is a rare occurrence in the U.S., as the consequences are severe and citizenship is highly prized. In recent years, the government has prioritized denaturalization for serious criminals and national security cases. Bigamy in and of itself generally does not rise to that level.

Patricia Corrales, a former Immigration and Customs Enforcement attorney who was involved with many denaturalization cases in her career, said revoking citizenship has been used in situations with national security concerns, particularly when they involve false testimony, without disclosing secrets or such suspicions.

“Now, most people think, “Bigamy, what’s the big deal with that?’ ” said Corrales, who is now an immigration attorney in Southern California. “We want only people who deserve to be U.S. citizens in this country to have that status. If you’re going to lie about your kids, what else are you going to be lying about?”

Li worked for a small Arizona technology contractor, which had brought Lizhong Fan, a Chinese national and computer programmer, to work on a facial recognition program at the Arizona Counter Terrorism Information Center.

Fan previously had worked in China on a facial recognition program that was set up by the contractor, Hummingbird Defense Systems, and its founder, Steve Greschner. Hummingbird partnered with Chen’s company, Detaq Science, on the project months after Li approached Greschner in 2002.

Fan, who was in the country on a special visa, abruptly left the country in June 2007. Without notifying Greschner, Fan took two laptops, cellphones and other company property.

The company reported the incident to the FBI, which opened an inquiry. An immigration-related investigation soon followed, which eventually led to Li’s arrest in 2008. She pleaded guilty in 2009 to knowingly making false statements related to naturalization. A U.S. district judge sentenced her to five years’ probation.

ProPublica reporter Ryan Gabrielson contributed to this story. It was edited by Robert Salladay and copy edited by Nikki Frick.