Chinese Citizens Alleged in Plot to Smuggle US Technology to China

Two Chinese nationals have been accused by the Justice Department of attempting to illegally export American technology to China.

The two, 44-year-old Han Li and 64-year-old Lin Chen, are charged with crimes related to an alleged conspiracy to smuggle American-made technology related to semiconductor production to restricted Chinese companies. If convicted, the two could face decades in prison and millions of dollars in fines.

“As alleged, the defendants sought to evade export controls to obtain U.S. semiconductor manufacturing technology for a prohibited Chinese company,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “The Justice Department is committed to enforcing export controls and holding accountable those who seek to illicitly procure U.S.-developed technologies that puts our national security at risk.”

Chen was arrested in Chicago on Thursday while Li is believed to be in China.

According to the DOJ, the two used a series of intermediary companies to evade Commerce Department restrictions from May 2015 to August 2018. The indictment says that they were attempting to illegally export a machine used to cut thin semiconductors, known as silicon wafers, which are used in a variety of electronic devices.

The two allegedly set up a company called Jiangsu Hantang International to purchase the machines from the California based Dynatex International. Instead of using the technology, they then attempted to illegally export the machines to restricted companies in China, the indictment says.

The restrictions were imposed to prevent certain American technology from falling into the hands of China’s military.

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“The export restrictions at issue in this case were put in place to prevent the illicit procurement of commodities and technologies for unauthorized military end use in the People’s Republic of China,” said U.S. Attorney for the Northern District of California Ismail Ramsey.

Investigators from the FBI, Homeland Security, and the Commerce Department all worked on the case.

“Stopping the illegal export of U.S. technology to China is one of the FBI’s highest priorities. We will aggressively pursue anyone who violates export control laws designed to protect our national and economic security,” said FBI Agent Robert Tripp.

The United States’s national security agencies have warned for years about Chinese theft of American technology and intellectual property.