Two Sentenced for Illegally Attempting to Export Microchips to China
The U.S. Attorney's Office for the Eastern District of Virginia has announced that two Chinese nationals, Hong Wei Xian and Li Li, were sentenced to 24 months in prison for participating in a conspiracy to violate the Arms Export Control Act and smuggle radiation-hardened microchips from the U.S. for an agency controlled by China responsible for the development of missiles and launch vehicles.
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(Since 1990, the U.S. government has maintained an arms embargo against China that prohibits the export, re-export, or re-transfer of any defense article to China. Prohibited defense articles are placed on the U.S. Munitions List (USML), which includes spacecraft systems and associated equipment.)
Nat'ls Imported & Sold Microchips to Gov't-Controlled Aerospace Corp in China
Xian and Li both plead guilty in June 2011. Xian and Li were officers of Beijing Starcreates Space Science and Technology Development Company Limited, which, among other things, engages in the business of importing and selling programmable read-only memory microchips (PROMs) to China Aerospace Science and Technology Corporation. This corporation is controlled by the Chinese government and plays a substantial role in the research, design, development and production of strategic and tactical missile systems and launch vehicles for China.
Didn't Apply or Receive a License from U.S. to Export Defense Articles
According to their guilty pleas, Xian and Li admitted that they neither applied for nor received a license from the U.S. to export defense articles of any description. From April 2009 to September 1, 2010, the two contacted a company in Virginia, seeking to export thousands of radiation-hardened PROMs. Xian and Li knew a license was required, but did not seek to obtain one because it would have required them to identify the end user — their Chinese government-controlled customer, China Aerospace — and describe the end use that would occur on behalf of China.
Conspired to Put Orders in Many Shipments, Designate Countries Outside China
To avoid drawing attention to the true purpose of their orders, the defendants conspired to break up orders into multiple shipments and designate countries outside China for delivery.
Served 7 Months in Hungary, Sentenced to 24 Months in U.S.
On September 1, 2010, the defendants were arrested in Hungary pursuant to a U.S. provisional arrest warrant and transferred into the custody of U.S. Marshals on April 1, 2011, after they waived extradition. In sentencing the defendants, the Judge took into account the seven months the defendants had spent in jail in Hungary. The defendants were sentenced to 24 months in prison. Effectively, then, the defendants’ sentence was 31 months in prison in total.