China spy status queried in foreign interference trial

An Australian businessman was asked to divulge confidential information to a post-graduate who wanted to "do something different" but was not a Chinese intelligence agent, a jury has been told.

Alexander Csergo is facing a NSW District Court jury trial accused of reckless foreign interference after providing reports to individuals believed to be working for China's Ministry of State Security.

The 59-year-old had been working on telecommunications infrastructure through his Shanghai-based business.

He met the two suspected Chinese spies in December 2021 and was asked for private material on sensitive topics.

"I need to do something different," one of the alleged spies, only known as Ken, texted Csergo in May 2022.

There was no evidence that Ken or his subordinate Evelyn - who also contacted Csergo - were working for Chinese intelligence, defence barrister Iain Todd told the jury on Tuesday.

"Is (Ken) actually directed or just on his own mission?" the barrister asked.

Ken gave Csergo a "shopping list" of sensitive topics to research in early 2023 before he returned to Australia.

That document was found stuffed into a shelf, creased and full of spelling errors, by police and domestic spies when they raided his eastern suburbs' home in March 2023.

Mr Todd expressed surprise at a Chinese intelligence agency which could not spell and instead suggested it was just Ken going off on a frolic.

Csergo did not do anything with this shopping list, the jury was told.

He also merely provided Ken and Evelyn with plagiarised, useless reports copied from publicly available websites in exchange for envelopes of cash, Mr Todd said.

"I'm not sure that would be seen as a success by any intelligence service."

The 59-year-old falsely claimed some came from sources including former prime minister Kevin Rudd.

The ex-Labor leader earlier told the trial he had never responded to the accused Chinese asset's approaches.

If Ken and Evelyn really were Chinese spies, they would have had some awkward conversations with their superiors, Mr Todd said.

Earlier on Tuesday, crown prosecutor Jennifer Single SC said the relationship between Csergo and the two alleged spies, and the contacts he had was more valuable than his reports.

While in contact with them, he was also working with US tech giant Oracle.

He told federal police he believed US intelligence wanted to use his connection with Oracle to obtain sensitive Chinese telecommunications data.

A friend of his doing work with the US got in touch, the jury heard.

"If you have any concerns and need to get out of China, we can get you out in 24 hours," Csergo was told.

This was at the height of strict COVID lockdowns, Ms Single noted.

In working with Ken and Evelyn, Csergo compiled reports on topics such as mining, the German government, the AUKUS security agreement and the Quad partnership.

These were handed over in hard copy or on a USB at face-to-face meetings at cafes or restaurants, which were sometimes devoid of other people, the jury heard.

In a WeChat thread, Ken said less-sensitive topics like bilateral trade were too normal and boring to cover.

He then told Csergo to "be brave" and seek material that could breach national security.

In her closing submissions to the jury, Ms Single said trust increased between Csergo and his two handlers, shown by cash payments rising from the equivalent of about $1000 to more than $6000.

In his police interviews, the Australian said his game was to provide material to Ken or Evelyn that was not real or confidential.

"You just keep it at the BS level," he told officers.

The Australian said he simply worked with the duo because he was under Chinese surveillance.

But were that true, he could have approached Australian authorities and he chose not to because he intended to return to China and continue his relationship with them, the prosecutor said.

The trial continues on Wednesday.