TWO Chinese men accused of trying to sneak sensitive technology with military applications out of the United States by posing as American businessmen have been charged with conspiracy and money laundering in a federal indictment unsealed on Tuesday.
The indictment accused the men of creating a “sophisticated scheme” involving Westernized aliases, a fake website and falsely assumed names of other businesses to conceal their true identities and nationality from the Oregon-based company that makes the technology.
The aim of the unsuccessful scheme, according to the 12-count indictment, was to purchase devices that have “dual use” commercial and military applications without obtaining the required export licenses.
“This indictment tells illicit traders that violating the U.S. export regulations threatens our national security and will be dealt with accordingly,” said Julie Salcido, special agent-in-charge of the U.S. Commerce Department’s Bureau of Industry, Office of Export Enforcement.
The indictment, returned last year against Wan Li Yuan, who assumed the name Nicholas Bush, and a second Chinese resident who used the alias Jason Jiang, identified the technology in question as programmable logic devices, or PLDs, which have military applications in equipment such as missiles and radar systems.
It said the devices are made by Lattice Semiconductor Corporation of Hillsboro, Oregon, to perform at extreme temperature ranges and are tested to military specifications.
It is doubtful the men will ever see a U.S. courtroom as China is unlikely to hand them over to American authorities.
“Even if we cannot arrest them overseas, we will seek to forfeit any assets we find in the United States,” Amanda Marshall, U.S. Attorney for Oregon, said in a statement.
Assistant U.S. Attorney Charles Gorder said he could not speculate on what the men planned to do with the devices had they been able to obtain them.
The pair told Lattice they planned to use the PLDs in an American coal mine and for oil drilling, the indictment said. They also said they would be used by a mining company in Australia, according to the filing.
Lattice cooperated with the government in the investigation, the Justice Department Justice said in a statement. Byron Milstead, Lattice’s general counsel, said the company had notified the FBI that these orders seemed dubious.
“We’re pretty vigilant in terms of our export compliance,” Milstead said. “This seemed on its face to be suspicious, so we turned the matter over to the FBI.”
Milstead declined to discuss Lattice’s role in the undercover investigation or disclose the total value of the devices the men were trying to buy.
The FBI and Commerce Department used an undercover operation and seized $414,000 in funds sent by Yuan as down-payments for the Lattice devices.