1

______________________________________________________________________________

January 2018 NSD 

WWW.JUSTICE.GOV (202) 514-2007

 

SUMMARY OF MAJOR U.S. EXPORT ENFORCEMENT, ECONOMIC ESPIONAGE,

AND SANCTIONS-RELATED CRIMINAL CASES

(January 2015 to the present: updated January 19, 2018)

Below are brief descriptions of some of the major export enforcement and sanctions-related criminal 

prosecutions by the Department of Justice since January 2015. These cases resulted from investigations 

by Homeland Security Investigations (HSI), the Federal Bureau of Investigation (FBI), the Department of 

Commerce's Bureau of Industry and Security (BIS), the Pentagon's Defense Criminal Investigative 

Service (DCIS), and other law enforcement agencies. This list represents only select cases and is not 

exhaustive.

Microwave Integrated Circuits for China - On Jan. 19, 2018, in the Central District of California, Yi-Chi 

Shih, an electrical engineer who is a part-time Los Angeles resident, and Kiet Ahn Mai were arrested 

pursuant to a criminal complaint. The complaint alleges that Shih and Mai conspired to illegally provide 

Shih with unauthorized access to a protected computer of a United States company that manufactured 

specialized, high-speed computer chips known as monolithic microwave integrated circuits (MMICs). 

The conspiracy count also alleges that the two men engaged in mail fraud, wire fraud, and international 

money laundering to further the scheme. It also alleges that Shih violated the International Emergency 

Economic Powers Act (IEEPA). The complaint affidavit alleges that Shih and Mai executed a scheme to 

defraud the U.S. company out of its proprietary, export-controlled items, including technology associated 

with its design services for MMICs. The victim company’s proprietary semiconductor technology has a 

number of commercial and military applications, and its customers include the Air Force, Navy, and the 

Defense Advanced Research Projects Agency. MMICs are used in electronic warfare, electronic warfare 

countermeasures, and radar applications. As part of the scheme, Shih and Mai accessed the victim 

company’s computer systems via its web portal after Mai obtained that access by posing as a domestic 

customer seeking to obtain custom-designed MMICs that would be used solely in the United States. Shih 

and Mai allegedly concealed Shih’s true intent to transfer the U.S. company’s technology and products to 

the People’s Republic of China, and specifically to Chengdu GaStone Technology Company (CGTC), a 

Chinese company which was placed on the Commerce Department’s Entity List in 2014. Shih is a former 

president of CGTC.

Night Vision Military Technology to Italy – On Dec. 21, 2017, in the Eastern District of New York,

Giovanni Zannoni, an Italian national and member of the Italian armed services, pleaded guilty to 

illegally exporting controlled military technology from the United States to Italy. As part of his plea, 

Zannoni agreed to forfeit $436,673, in addition to the dozens of gun parts and night vision and thermal 

imaging devices recovered by the government in connection with this prosecution. According to court 

filings and admissions made in court at the time he entered the guilty plea, between June 2013 and May 

2017 Zannoni illegally exported and attempted to export night vision goggles and assault rifle 

components designated as defense articles on the United States Munitions List. The export of sensitive 
2

night vision equipment and assault rifle components requires a license from the U.S. Department of 

State. On May 14, 2017, the defendant was arrested after entering the United States at Miami 

International Airport. This case was investigated by the Department of Defense, Defense Criminal 

Investigative Service, Northeast Field Office (DCIS); U.S. Immigration and Customs Enforcement (ICE), 

Homeland Security Investigations (HSI); and the U.S. Attorney’s Office. 

U.S. Military Technology to IRGC - On Dec. 15, 2017, in the Southern District of New York, Ali Soofi, 

a Canadian-Iranian dual citizen, was sentenced to 32 months in prison for his participation in a conspiracy 

to violate the International Emergency Economic Powers Act (IEEPA). Soofi was charged and arrested 

by special agents of the Federal Bureau of Investigation (FBI) following an investigation. Soofi pleaded

guilty to one count of conspiracy to violate IEEPA on September 7, 2017, before U.S. District Judge 

Nelson S. Román, who imposed the sentence. Between 2014 and December 2016, Soofi conspired to 

export military items from the United States to Iran, both directly and through transshipment to 

intermediary countries, without a license. In particular, Soofi acted as a broker on behalf of Iranian 

clients, including a high-ranking official in the Iranian Revolutionary Guard Corps (IRGC), who sought

American military technology. Over the course of the conspiracy, Soofi sought to purchase and ship 

numerous items, including helicopters, high-tech machine gun parts, tank parts, and military vehicles, 

from the United States to Iran, all without a license and while knowing that such shipments were illegal 

under U.S. law. During the multi-year conspiracy, Soofi worked to fill specific orders for the IRGC by 

contacting other individuals with access to the requested military items through email, phone, and inperson meetings. The IRGC has been designated as a Specially Designated Global Terrorist for its 

activities in support of terrorist groups including Hezbollah, Hamas, and the Taliban. One of Soofi’s 

customers was a Commander in the IRGC, who acted as a key figure at the Iranian Ministry of Defense 

responsible for procurement of parts and weapons. Among the weapons Soofi sought on behalf of the 

IRGC were dampeners – or shock absorbers – which allow high-tech machine guns to be mounted on 

helicopters and boats. In addition, Soofi sought to obtain slewing rings for tanks, military helicopters, 

target sights, jet engines, and military vehicles such as Humvees for the IRGC. In addition to the prison 

term, Soofi, 63, was sentenced to one year of supervised release.

Marine Products for Iranian Navy - On Dec. 11, 2017, in the Eastern District of Wisconsin, Resit Tavan, 

age 40, of Istanbul, Turkey, was arraigned in federal court in Milwaukee on an indictment returned June 

27, 2017. Tavan, owner and president of Ramor Dis Ticaret, Ltd. (Ramor), a Turkish company, and Fulya 

Oguzturk are charged, along with Ramor, with conspiring to defraud the United States and to smuggle 

American made products to Iran in violation of the International Emergency Economic Powers Act 

(IEEPA). The indictment charges that Tavan, Oguzturk, and Ramor arranged the purchase and 

acquisition of marine products manufactured in Wisconsin, for shipment to and use by Iran. The 

indictment alleges that the goods, specifically outboard engines, generators, and propulsion systems, were 

shipped first to Turkey and then to Iran without the knowledge of the manufacturers, and without the 

permission and license of the United States. The indictment further alleges that the marine products were 

intended for use by the Iranian navy. In addition to the conspiracy charge, the indictment charges three 

counts of violating IEEPA; three counts of smuggling; and six counts of money laundering. If convicted, 

Tavan faces up to 5 years in prison and a $250,000 fine on the conspiracy count; up to 20 years and a 

$1,000,000 fine on each IEEPA count; up to 10 years and a $250,000 fine on each smuggling count; and 

up to 20 years and a $500,000 fine on each money laundering count. Tavan was arrested in Romania in 

June 2017, on an international arrest warrant issued at the request of the United States. Upon his arrest, 

the United States requested Tavan’s extradition from Romania. He was extradited from Romania to the 

United States in December 2017. This case was investigated by the Federal Bureau of Investigation and 

the U.S. Department of Commerce, Bureau of Industry and Security, Office of Export Enforcement.
3

Aviation Parts and Equipment to Syria - On Oct. 3, 2017, in the Southern District of Florida, three 

Miami-Dade County residents, Ali Caby, a/k/a “Alex Caby,” 40, Arash Caby, a/k/a “Axel Caby,” 43, and 

Marjan Caby, 34, pleaded guilty to Count 1 of an Indictment charging them with conspiracy to defraud 

the United States and to illegally export aviation parts and equipment to Syria in violation of the 

International Emergency Economic Powers Act (IEEPA). The exports were sent to Syrian Arab Airlines, 

a/k/a “Syrian Air,” which had been designated as a Specially Designated National (SDN) by the U.S. 

Department of Treasury, Office of Foreign Assets Control (OFAC). U.S. persons and entities are 

prohibited from doing business with SDNs, such as Syrian Air, without obtaining a license from OFAC.

According to court documents, Ali Caby ran the Bulgaria office of AW-Tronics, a Miami export company 

that was managed by Arash Caby, and which shipped and exported various aircraft parts and equipment 

to Syrian Air. Ali Caby and Arash Caby closely supervised and encouraged subordinate employees of 

AW-Tronics in the willful exportation of the parts and equipment to SDN Syrian Air. Marjan Caby, as 

AW-Tronics’ export compliance officer and auditor, facilitated these exports by submitting false and 

misleading electronic export information to federal agencies. On Dec. 19, 2017, Ali Caby was sentenced 

to 24 months in prison and forfeiture of $17,500; Arash Caby was sentenced to 24 months in prison and 

fined $10,000; and Marjan Caby was sentenced to 1 year and 1 day in prison. 

U.S. Army Equipment on eBay – On Sep. 1, 2017, in the Middle District of Tennessee, John Roberts, 27, 

of Clarksville, Tenn., was found guilty by a federal jury of conspiracy to steal and sell U.S. Army 

property, 10 counts of wire fraud, and two counts of violating the Arms Export Control Act. The jury 

returned a verdict of guilty on all counts, after a four-day trial in U.S. District Court. Roberts is the final 

defendant convicted in the conspiracy, after an indictment issued in October 2016 charged six U.S. Army 

soldiers and two civilian eBay sellers with various crimes. The Court remanded Roberts to the custody of 

the U.S. Marshal following the verdict. According to the proof at trial, Roberts conspired with the 

soldiers, who stole U.S. Army equipment, often after hours, from the U.S. Army installation at Fort 

Campbell. Roberts then purchased the equipment from the soldiers, often times in dark parking lots and 

by cash only transactions. Roberts knew that some of the soldiers had financial problems or serious drug 

addictions. Roberts then resold this military grade equipment via eBay. The U.S. Army equipment listed 

for sale on eBay included sniper telescopes and other sniper rifle accessories, parts for the M249 machine 

gun (including barrel assemblies, trigger groups, rail adapter kits, magazine buttstocks, mounts, and heat 

shields), sights for the M203 grenade launcher, “red dot” sights for the M2 rifle and M4 assault rifle, 

flight helmets, communications headsets, and medical supplies. Further proof at trial established that 

Roberts illegally exported certain restricted U.S. Army equipment, including night vision helmet mounts,

and that Roberts sold U.S. Army equipment to eBay customers around the world, including customers in 

Russia, China, Thailand, Japan, the Netherlands, Australia, India, Germany, and Mexico. Six codefendant’s previously pleaded guilty. On Dec. 21, 2016, former U.S. Army Specialist Dustin Nelson, 23 

of Northville, New York pleaded guilty to conspiracy to steal and sell U.S. Army property. On Feb. 8, 

2016, former U.S. Army Specialist Kyle Heade, 30, formerly of Fort Campbell, Kentucky, pleaded guilty 

to conspiracy to steal and sell U.S. Army property. On March 30, 2016, former U.S. Army Sergeant 

Michael Barlow, 30, of Clarksville, Tenn., pleaded guilty to conspiracy to steal and sell U.S. Army 

property and theft of government property. On April 6, 2017, Cory Wilson, 43, of Gonzalez, Louisiana, 

pleaded guilty to conspiracy to steal and sell U.S. Army property, wire fraud, and violating the Arms 

Export Control Act. On April 26, 2017, Jonathan Wolford, 29, of Clarksville, Tenn., pleaded guilty to 

conspiracy to steal and sell U.S. Army property. On April 26, 2017, Alexander Hollibaugh, formerly of 

Fort Campbell, Kentucky, pleaded guilty to conspiracy to steal and sell U.S. Army property. On Dec. 5, 

2017, Roberts was sentenced to 180 months in prison and $4,270,000 restitution. 

Firearms to Dominican Republic - On Aug. 25, 2017, in the Southern District of Florida, former MiamiDade Police Department (MDPD) officer Michael Freshko, 48, was sentenced to four years in prison after 

previously pleading guilty to conspiracy to unlawfully export firearms from the United States to the 
4

Dominican Republic, on flights from Miami International Airport. According to the court record, after 

receiving firearms from a co-conspirator, Freshko used his official position as a MDPD officer to 

transport the firearms past the passenger screening area and into the portion of Miami International 

Airport that housed the departure gates. Freshko thereafter would deliver the firearms to a co-conspirator, 

who in turn would store the firearms within carry-on baggage. Next, a co-conspirator would travel to the 

Dominican Republic aboard a commercial flight, with the firearms in carry-on baggage. After arriving in 

the Dominican Republic, a co-conspirator would deliver the firearms to an associate. Freshko further 

admitted that one or more firearms were smuggled in this manner in October 2012, and multiple firearms 

were smuggled in December 2012. The smuggled firearms included four Glock .9 mm pistols, one Sig 

Sauer .9 mm pistol, and one Sig Sauer 5.56 rifle.

Integrated Circuits to Russia and China - On Aug. 3, 2017, in the Eastern District of Texas, Peter 

Zuccarelli pleaded guilty to conspiring to smuggle and illegally export radiation hardened integrated 

circuits (RHICs) from the United States, for use in the space programs of China and Russia, in violation 

of the International Emergency Economic Powers Act (IEEPA). Zuccarelli pleaded guilty to engaging in 

a conspiracy to smuggle and illegally export U.S. items subject to IEEPA, without obtaining licenses 

from the Department of Commerce. According to the allegations contained in the Information filed 

against Zuccarelli and statements made in court filings and proceedings: Between approximately June 

2015 and March 2016, Zuccarelli and his co-conspirator agreed to illegally export RHICs to China and 

Russia. RHICs have military and space applications, and their export is strictly controlled. In furtherance 

of the conspiracy, Zuccarelli’s co-conspirator received purchase orders from customers seeking to 

purchase RHICs for use in China’s and Russia’s space programs. Zuccarelli received these orders from 

his co-conspirator, as well as payment of approximately $1.5 million to purchase the RHICs for the 

Chinese and Russian customers. Zuccarelli placed orders with U.S. suppliers, and used the money 

received from his co-conspirator to pay the U.S. suppliers. In communications with the U.S. suppliers, 

Zuccarelli certified that his company, American Coating Technologies, was the end user of the RHICs, 

knowing that this was false. Zuccarelli received the RHICs he ordered from U.S. suppliers, removed them 

from their original packaging, repackaged them, falsely declared them as “touch screen parts,” and 

shipped them out of the United States without the required licenses. In an attempt to hide the conspiracy 

from the U.S. Government, he created false paperwork and made false statements. On Jan. 24, 2018, 

Zuccarelli was sentenced to 46 months in prison, three years’ supervised release, and a $50,000 fine. This 

case was investigated by the Dallas and Denver Offices of the Department of Homeland Security, 

Homeland Security Investigations; the Federal Bureau of Investigation; Internal Revenue Service -

Criminal Investigation; Postal Inspection Service; the Department of Commerce, Bureau of Industry and 

Security, Office of Export Enforcement; and the Defense Criminal Investigative Service.

Rifle Scopes and Tactical Equipment to Syria - On Aug. 1, 2017, in the Central District of California, 

the chief executive officer of an Orange County check-cashing business was arrested on charges of 

procuring and illegally exporting rifle scopes, laser boresighters, and other tactical equipment from the 

United States to Syria in violation of the International Emergency Economic Powers Act (IEEPA). 

Rasheed Al Jijakli, 56, was arraigned on a three-count indictment that was returned by a federal grand 

jury on July 14. The indictment was unsealed after Jijakli was taken into custody without incident by law 

enforcement authorities. The indictment accuses Jijakli of violating IEEPA, which authorizes the 

president to impose economic sanctions on a foreign country in response to an unusual or extraordinary 

threat to the national security, foreign policy or economy of the United States. In accordance with that 

authority, the president issued an executive order that included broad restrictions on exports to Syria. The 

Department of Commerce subsequently issued corresponding regulations restricting exports to Syria of 

items subject to the Export Administration Regulations. Jijakli also faces charges of conspiring to violate 

IEEPA and smuggling. From January 2012 through March 2013, Jijakli and three other individuals 

purchased and smuggled export-controlled items to Syria without obtaining licenses from the Department 
5

of Commerce. Jijakli and others allegedly hand-carried the items through Istanbul, Turkey and provided 

them to fighters in Syria. Those items allegedly included day- and night-vision rifle scopes, laser 

boresighters (tools used to adjust sights on firearms for accuracy when firing), flashlights, radios, a 

bulletproof vest and other tactical equipment. This case is the result of an ongoing investigation by the 

FBI, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the U.S. 

Department of Commerce’s Office of Export Enforcement, and IRS Criminal Investigation.

Accelerometers and Gyroscopes for China - On July 27, 2017, in the Western District of Washington, a 

resident of New Zealand, who traveled to Seattle in April 2016 to take possession of export-restricted 

parts designed for missile and space applications, was sentenced in U.S. District Court to two years in 

prison for conspiring to violate the Arms Export Control Act. William Ali, 38, had been in federal 

custody since his arrest on April 11, 2016. According to records in the case and testimony presented at 

trial, Ali emailed several companies and distributors in April 2015 about purchasing certain 

accelerometers that are designed for use in spacecraft and missile navigation. These accelerometers 

cannot be exported from the United States without a license from the U.S. State Department, which Ali 

did not have. Homeland Security Investigations (HSI) learned of Ali’s inquiries and began an 

investigation. Over the next year, Ali communicated by phone and email with an HSI undercover agent, 

and with a person in China known in his emails as “Michael.” Michael was the person seeking the 

accelerometers, as well as certain gyroscopes that are designed for military use. Ali was working to find a 

way to purchase the devices and transport them secretly to Michael in China. In multiple emails, Ali made 

clear that he was aware that export of the accelerometers and gyroscopes was illegal. Ali sent the 

undercover agent nearly $25,000 for the devices – money he got from Michael. Ali traveled to Seattle and 

met with the undercover agent on April 11, 2016, at a downtown hotel. Shortly after Ali took possession 

of the devices, he was arrested. Ali had with him an airline ticket to Hong Kong and a visa to travel to 

China. This case was investigated by U.S. Immigration and Customs Enforcement’s Homeland Security 

Investigations.

Memory Chip Modules to Russia - On July 19, 2017, in the District of Colorado, an indictment was 

unsealed charging Bulgarian citizen Tsvetan Kanev with smuggling and violations of the International 

Emergency Economic Powers Act (IEEPA). According to the indictment, from mid-2015 and continuing 

through June 2016, Kanev unlawfully and willfully attempted to export and cause to be exported from the 

United States to Russia items on the Commerce Control List (“CCL”) without having first obtained the 

required authorization and license from the U.S. Department of Commerce. CCL items include those that 

could make a significant contribution to the military potential or nuclear proliferation of other nations or 

that could be detrimental to the foreign policy or national security of the United States. Specifically, 

Kanev exported static random access memory multi-chip modules, clock drivers (used to optimize timing 

of high performance microprocessors and communications systems), and multiple analog-to-digital 

converters.

Sophisticated Machinery to Iran - On July 17, 2017, in the District of Columbia, Joao Pereira da 

Fonseca, 55, a citizen of Portugal, pleaded guilty to a federal charge stemming from a scheme in which he 

conspired to help an Iranian company unlawfully obtain sophisticated equipment from two companies in 

the United States. Fonseca, of Coimbra, Portugal, pled guilty to conspiring to unlawfully export goods 

and technology to Iran and to defraud the United States. On Sep. 14, 2017, Fonseca was sentenced to 20 

months in prison. Upon completion of his prison term, Fonseca faces deportation proceedings. At the time 

he entered his guilty plea, Fonseca admitted to taking part in the scheme between October 2014 and April 

2016. One of the companies in the United States manufactures machines that help produce sophisticated 

optical lenses that have both commercial and military uses. The other company manufactures machinery 

that tests components of inertial guidance systems that have both commercial and military uses. Fonseca 

was a contractor for a Portuguese engineering company that served as a front company to purchase the 
6

machines on behalf of their Iranian client. The Portuguese company claimed that it was purchasing the 

machines for its own use, but planned to have the machines shipped to Iran. Fonseca is a mechanical 

engineer whose role in the conspiracy was to travel to the U.S. to approve the machinery and learn how to 

install and maintain the machinery once it was shipped to its final destination in Iran. Due to the 

investigation conducted by a special agent from Homeland Security Investigations, the government 

prevented both machines from leaving the U.S. Fonseca traveled to the United States to receive training 

on how to use the optical lens equipment in October 2015. He returned to the United States in late March 

2016 to be trained on how to use the inertial guidance system equipment at the company that 

manufactures it. After a week of training, Homeland Security agents had gathered sufficient evidence to 

detain Fonseca before he could fly back to Portugal. Soon thereafter, criminal charges were brought 

against Fonseca. He has been in custody ever since. 

Industrial Goods to Iran - On June 21, 2017, in the Northern District of Ohio, an indictment was 

unsealed charging IC Link Industries Ltd., Mohammad Khazrai Shaneivar, Arezoo Hashemnejad 

Alamdari, and Parisa Mohamadi a/k/a Parisa Javidi with conspiracy to export goods from the United 

States to Iran without the required license by the Department of the Treasury, Office of Foreign Assets 

Control, and to prevent officials of the U.S. Government from detecting and preventing the export of 

goods from the United States to Iran. IC Link Industries Ltd. (“IC Link”) registered as a corporation in 

Ontario, Canada, and its office was located in the Toronto area. IC Link’s business included procuring 

industrial goods in the United States for shipment to customers in Iran. IC Link’s affiliate in Tehran, Iran 

was Sensor Co. Ltd. (“Sensor”). Sensor was responsible for coordinating IC Link’s business with Iranian 

companies and handling IC Link’s financial dealings in Iran. According to the indictment, it was part of 

the conspiracy that Shaneivar, through IC Link, received orders from Alamdari and others at Sensor on 

behalf of customers in Iran for industrial goods available in the United States. These orders were 

primarily for goods used in the oil, gas, petroleum, and energy industries. IC Link sent requests for quotes 

(“RFQs”) for the goods to an uncharged individual in the Northern District of Ohio, who obtained quotes 

from suppliers in the United States that he forwarded to IC Link. Typically, the goods were sent to the 

individual’s business in the Northern District of Ohio. The goods were then shipped from the United 

States to an intermediary country other than Iran, such as the United Arab Emirates, Turkey, or other 

countries. Once the goods arrived in the intermediary country, a freight forwarder in that country reshipped the goods to Iran. While in the intermediary country, the goods were sometimes re-packaged to 

disguise their origin in the United States. It was further part of the conspiracy that Shaneivar and IC Link 

sometimes used Mohamadi to arrange the shipment of goods procured in Ohio to the ultimate destination 

in Iran. Alamdari or Shaneivar provided information on the true destination of the goods in Iran to 

Mohamadi to arrange the shipment. When shipping goods on behalf of IC Link, Mohamadi typically used 

a shipping company in the United States to ship the goods from Ohio to Dubai, United Arab Emirates, 

and other transshipment locations. Once the goods were in Dubai or elsewhere, Mohamadi used a 

different freight forwarding company to re-ship the goods to Iran.

Products for Pakistan Atomic Energy Commission - On June 1, 2017, in the District of Connecticut, 

Imran Khan, 43, of North Haven, waived his right to be indicted and pleaded guilty in federal court to 

violating U.S. export law. According to court documents and statements made in court, from at least 2012 

to December 2016, Khan and others were engaged in a scheme to purchase goods that were controlled 

under the Export Administration Regulations (EAR) and export those goods without a license to Pakistan, 

in violation of the EAR. Khan conducted business as Brush Locker Tools or as Kauser Enterprises-USA. 

When asked by U.S. manufacturers about the end-user for a product, Khan either informed the

manufacturer that the product would remain in the U.S., or he completed an end-user certification 

indicating that the product would not be exported. After the products were purchased, they were shipped 

by the manufacturer to Khan’s North Haven residence or Cerda Market in New Haven, a business owned 

by Khan. The products were then shipped to Pakistan on behalf of either the Pakistan Atomic Energy 
7

Commission (PAEC), the Pakistan Space & Upper Atmosphere Research Commission (SUPARCO), or 

the National Institute of Lasers & Optronics (NILOP), all of which were listed on the U.S. Department of 

Commerce Entity List. Khan never obtained a license to export any item to a designated entity, even 

though he knew that a license was required prior to export. Khan pleaded guilty to one count of violating 

the International Emergency Economic Powers Act. In pleading guilty, Khan specifically admitted that, 

between August 2012 and January 2013, he procured, received, and exported to PAEC an Alpha Duo 

Spectrometer without a license to do so.

Dark Net Used to Export Firearms - In May 2017, in the Northern District of Georgia, Gerren Johnson 

and William Jackson were arraigned on federal charges of dealing in firearms without a license, 

smuggling goods from the United States to other countries, and illegal delivery of firearms to a common 

carrier. The defendants allegedly exported guns illegally to buyers all over the world. According to the 

charges and other information presented in court: In June 2013, the Bureau of Alcohol, Tobacco, Firearms 

and Explosives (ATF) and other agencies began investigating an international firearms trafficking scheme 

in which individuals utilized a Dark Net website called Blackmarket Reloaded (BMR). The individuals 

used the usernames CherryFlavor and WorldWide Arms. The investigation revealed that firearms posted 

for sale on this website were sold to persons outside the United States, and were shipped to buyers from 

the United States hidden inside electronic items. Some of the countries to which packages were shipped 

include Canada, the United Kingdom, and Australia. Federal search warrants, coupled with trace 

interviews, allegedly connected all firearms recovered from original purchasers in the Atlanta area to the 

defendants. The defendants had been acquiring firearms legally from the OutDoorTraders website, and 

later reselling the firearms on underground websites including BMR, Utopia, and Agora Market. Also, 

shipping information for over 50 suspected parcels was disseminated to investigators in Austria, 

Australia, Belgium, Canada, the United Kingdom, Ireland, Denmark, France, Germany, the Netherlands, 

and Sweden. Intelligence analysis, as well as a massive audit of internationally-shipped parcels 

originating from several suspect U.S. Post Offices, resulted in the identification of the individuals in the 

CherryFlavor group. Gerren Johnson, 28, of Austell, Georgia, was arraigned on May 24, 2017. William 

Jackson, 29, of East Point, Georgia, was arraigned on May 30, 2017. Two other defendants, Sherman

Jackson and Brendan Person, previously were arrested and entered pleas of guilty.

Trade Secrets for Company in China - On May 24, 2017, in the District of Columbia, a criminal 

complaint was unsealed charging seven individuals with conspiring to steal trade secrets from a business 

in the United States on behalf of a company in China that was engaged in manufacturing a highperformance, naval-grade product for military and civilian uses. On May 23, 2017, two defendants were 

arrested in Washington, D.C., three in the Southern District of Texas, and one in the District of 

Massachusetts. All are charged in the U.S. District Court for the District of Columbia with conspiracy to 

commit theft of trade secrets. The government also filed a related civil forfeiture complaint in the District 

of Columbia for two pieces of real property which were involved in, and are traceable to, the alleged 

illegal conduct. Those arrested and charged include four U.S. citizens: Shan Shi, 52, of Houston, Texas; 

Uka Kalu Uche, 35, of Spring, Texas; Samuel Abotar Ogoe, 74, of Missouri City, Texas; and Johnny 

Wade Randall, 48, of Conroe, Texas. Also charged were Kui Bo, 40, a Canadian citizen who has been 

residing in Houston, and Gang Liu, 31, a Chinese national who has been residing in Houston as a 

permanent resident. Additionally, charges were filed against one Chinese national living in China, Hui 

Huang, 32, an employee of the Chinese manufacturing firm allegedly involved in tasking employees of 

the Houston company. According to an affidavit filed in support of the criminal complaint, the trade 

secrets were stolen in order to benefit a manufacturer located in China; this manufacturer was the only 

shareholder for a company that had been incorporated in Houston. Between in or about 2012 and the 

present, the affidavit alleges that the Chinese manufacturer and employees of its Houston-based company 

engaged in a systematic campaign to steal the trade secrets of a global engineering firm, referred to in the 

affidavit as “Company A,” that was a leader in marine technology. The case involves the development of 
8

a technical product called syntactic foam, a strong, light material that can be tailored for commercial and 

military uses, such as oil exploration; aerospace; underwater vehicles, such as submarines; and stealth 

technology. According to the affidavit, the Chinese manufacturer intended to sell syntactic foam to both 

military and civilian, state-owned enterprises in China – part of a push toward meeting China’s national 

goals of developing its marine engineering industry. The affidavit alleges that the conspirators took part in 

the theft of trade secrets from Company A, a multi-national company with a subsidiary in Houston that is 

among the major producers of syntactic foam. The affidavit identifies a number of trade secrets allegedly 

taken from the company between January and June of 2015, including secrets that allegedly were passed 

to people associated with the Chinese manufacturer and Houston-based company. The maximum penalty 

for a person convicted of conspiring to commit theft of trade secrets is 10 years in prison and potential 

financial penalties. This case is being investigated by the FBI’s Houston Field Office; the U.S. 

Department of Commerce’s Bureau of Industry and Security (BIS), Office of Export Enforcement; and 

the IRS-Criminal Investigation (IRS-CI).

Riflescopes for Russia - On May 10, 2017, in the Middle District of Pennsylvania, Mark Komoroski, age 

54, of Nanticoke, Pennsylvania, was indicted for violating federal export laws and unlawfully possessing 

ammunition as a previously convicted felon. The indictment was unsealed on May 11, 2017, following 

Komoroski’s arrest and initial appearance before United States Magistrate Judge Karoline Mehalchick. 

The indictment alleges that in February and March of 2016, Komoroski attempted to export two 

riflescopes to an individual in Russia without first obtaining the export licenses required by federal law. 

The indictment also alleges that Komoroski, a previously convicted felon, possessed over 25,000 rounds 

of ammunition. On January 16, 2018, Komoroski pleaded guilty, but no sentencing date was set. This 

case was investigated by the Department of Homeland Security and the Department of Commerce. 

Space Communications Technology to China - On May 23, 2017, in the Central District of California, Si 

Chen a/k/a Cathy Chen was arrested on federal charges of conspiring to procure and illegally export 

sensitive space communications technology to her native China. An indictment that was returned by a 

federal grand jury on April 27 and was unsealed after her arrest. The 14-count indictment accuses Chen of 

violating the International Emergency Economic Powers Act (IEEPA), which controls and restricts the 

export of certain goods and technology from the United States to foreign nations. Chen is also charged 

with conspiracy, money laundering, making false statements on an immigration application, and using a 

forged passport. According to the indictment, from March 2013 to December 2015, Chen purchased and 

smuggled sensitive items to China without obtaining licenses from the U.S. Department of Commerce 

that are required under IEEPA. Those items allegedly included components commonly used in military 

communications “jammers” from which Chen removed the export-control warning stickers prior to 

shipping. Additionally, Chen is suspected of smuggling communications devices worth more than 

$100,000 that are commonly used in space communications applications. On the shipping paperwork 

Chen falsely valued the items at $500. The indictment further describes how Chen received payments for 

the illegally exported products through an account held at a bank in China by a family member. Chen was 

taken into custody without incident by special agents with U.S. Immigration and Customs Enforcement’s 

Homeland Security Investigations (HSI), the U.S. Department of Commerce’s Office of Export 

Enforcement (OEE), and the Defense Criminal Investigative Service (DCIS).

Military Equipment Exported by Czech and Slovak Citizens - In May 2017, in District of Connecticut, a 

federal grand jury in New Haven returned two indictments charging citizens of the Czech Republic and 

the Slovak Republic with offenses related to the illegal export of U.S. military equipment. On May 16, 

2017, the grand jury returned a two-count indictment alleging that, between June 2011 and November 

2011, Josef Zirnsak, 38, of the Czech Republic, shipped from the U.S. to Germany an infrared dual beam 

aiming laser and a rifle scope, both of which are designated as defense articles on the U.S. Munitions List.

On May 3, 2017, the grand jury returned a five-count indictment alleging that, between May 2012 and 
9

June 2012, Martin Gula, also known as “Mark Welder,” 38, of the Slovak Republic, purchased and 

attempted to arrange the export of night vision goggles and an aviator night vision system from the U.S. 

to the United Kingdom. This indictment also alleges that, during the same time period, Gula used a false 

U.S. passport as proof of residency and citizenship in the U.S. Zirnsak and Gula are each charged with 

two counts of violating the Arms Export Control Act. Gula also is charged with two counts of smuggling 

and one count of use of a false passport. Zirnsak and Gula are currently being sought by law enforcement.

In January 2014, Gula was charged in the Central District of California with export related offenses. That 

indictment also is pending. This case is being investigated by the Defense Criminal Investigative Service 

(DCIS) and Homeland Security Investigations (HSI). 

Night Vision Components to Russia - On April 27, 2017, in the Northern District of California, Naum 

Morgovsky and Irina Morgovsky were charged for their respective roles in an alleged scheme to export 

components for the production of night vision rifle scopes in violation of the Arms Export Control 

Act. The superseding indictment supplements bank fraud charges that were leveled in September 2016 

against Naum Morgovsky and Mark Migdal. According to the superseding indictment, Naum and Irina 

Morgovsky owned night vision businesses in the United States and purchased numerous scope 

components including image intensifier tubes and lenses. The indictment alleges the Morgovskys 

conspired to ship these items to a night vision manufacturing company in Moscow, Russia, that was 

partly owned by Naum Morgovsky. The United States Munitions List prohibits export of these items 

unless the exporter obtains a license from the Department of State, Directorate of Defense Trade 

Controls. According to the indictment, the Morgovskys did not have such a license. In addition, the 

indictment alleges the Morgovskys took steps to conceal their crimes so that they could continue to run 

their illegal export business undetected. Naum Morgovsky laundered the proceeds of the export 

conspiracy, using a bank account in the name of a deceased person to conceal the ownership and control 

of the scheme’s proceeds. The indictment further alleges that Irina Morgovsky used a passport that she 

fraudulently obtained in the name of another individual to travel to Russia three times in 2007. The 

prosecution is the result of an investigation by the Federal Bureau of Investigation, Internal Revenue 

Service, Criminal Investigation, and the Department of Commerce.

Gun Parts Smuggled by Russian Citizen - On April 26, 2017, in the Northern District of Illinois, 

Konstantin Chekhovskoi, a citizen of the Russian Federation, was arrested on a complaint charging him 

with attempting to export articles from the United States contrary to U.S. law, in violation of 18 U.S.C. § 

554. According to the complaint, U.S. Customs and Border Patrol (CBP) officers at O’Hare International 

Airport in Chicago selected Chekhovskoi for inspection pursuant to their border search authority as he 

attempted to board a commercial flight to Sweden. CBP inspected 11 suitcases, all of which were labeled 

with airline baggage tags with Chekhovskoi’s name on them. Among other things, officers uncovered 

rifle magazines and stocks, which they recognized to be enumerated on the U.S. Munitions List. Queries 

of appropriate law enforcement databases indicated Chekhovskoi did not have a license to export such 

items. In all, approximately 960 gun parts were seized from Chekhovskoi’s luggage, including 196 

magazines, 55 stocks, and 98 triggers. Chekhovskoi was taken into custody. A grand jury indicted 

Chekhovskoi on July 27. On Dec. 12, 2017, Chekhovskoi pleaded guilty to smuggling. He faces a 

maximum sentence of 10 years in prison and a maximum fine of $250,000. This case was investigated by 

Homeland Security Investigations.

Conspiracy to Export U.S. Goods to Iran - On March 29, 2017, in the Western District of Washington, 

Ghobad Ghasempour, a Canadian citizen of Iranian descent, made his initial appearance in court after 

being charged with conspiracy to unlawfully export U.S.-origin goods to Iran, in violation of 18 U.S.C. § 

371. Pursuant to an arrest warrant issued in the District of Columbia, Ghasempour was arrested on March 

28 after crossing the U.S.-Canadian border in Blaine, Washington. According to the criminal complaint, 

beginning in December 2011, Ghasempour formed various front companies, based in China, to purchase 
10

U.S.-origin goods destined for Iranian end-users. In June 2015, Ghasempour’s front company, Modo, 

transferred $150,000 to a company in Portugal with instructions that the money be used as a down

payment for a “rate table” manufactured by Ideal Aerosmith, located in North Dakota. This machine is 

used to test and calibrate highly sophisticated navigation and sensor equipment of the type commonly 

found in military aircraft and missiles. Ghasempour and his co-conspirators intended this rate table for 

end use in Iran.

Firearms to The Gambia - On March 27, 2017, in the Eastern District of North Carolina, Alhaji Boye 

was sentenced to 9 months of imprisonment followed by 3 years of supervised release. Boye pleaded

guilty on October 31, 2016, to conspiracy to export defense articles (firearms) from the United States

without a license. In 2012, with the intention of bringing political and social change to The Gambia, 

Gambian-American citizens and others joined a conspiracy entitled The Gambia Freedom League. The 

group hoped to take over the country, gain support from internal allies, and bring about regime 

change. The primary goal was to overthrow the Gambian President Yahya Jammeh, who had been in 

control of Gambia since his own coup in 1994 and whose rule had been marred by accusations of human 

rights violations. The conspiracy included directives for certain individuals to purchase firearms, others to 

ship them to The Gambia in 55-gallon barrels concealed among secondhand clothing, and others to travel 

and physically engage in the coup itself. Boye’s role was to purchase firearms and ammunition. On 

December 30, 2014, members of the armed conspiracy attempted to violently breach the door of the State 

House in Gambia. The attempt failed and many of the conspirators died as a result of the ensuing gun 

battle. Following the assault, the Gambian military recovered at least 35 firearms, assault gear, vehicles, 

and 55-gallon barrels. On December 31, 2014, a member of The Gambia Freedom League returned to the 

United States and was interviewed by the Federal Bureau of Investigation (FBI). With the information 

received from the interview, the FBI initiated their investigation. The investigation revealed bank records 

displaying that on August 25, 2014, $7,000 had been wired to Boye in Raleigh, North Carolina. On 

August 26, 2014, Boye had purchased two AK-47 style assault rifles, as well as 7,000 rounds of 

ammunition, and 98 AK-47 magazines. On September 5, 2014, Boye also purchased four Diamondback 

rifles. In early 2015, following the failed coup, FBI agents traveled to The Gambia, inventoried and 

photographed the 35 firearms seized by the Gambian government. Five of those firearms matched serial 

numbers on the firearms purchased by Boye. This criminal investigation was conducted by the FBI and 

the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).

Hizballah Supporter Charged with Violating IEEPA - In March 2017, Kassim Tajideen, a prominent 

financial supporter of the Hizballah terror organization, was arrested and charged with evading U.S. 

sanctions imposed on him because of his financial support of Hizballah. Tajideen, 62, of Beirut, Lebanon, 

was arrested overseas on March 12, 2017, based on an 11-count indictment unsealed in the U.S. District 

Court for the District of Columbia following Tajideen’s arrival to the United States. Tajideen made his 

initial court appearance on March 24, 2017, before Magistrate Judge Robin M. Meriweather. The 

indictment charges Tajideen with one count of willfully conspiring to violate the International Emergency 

Economic Powers Act (IEEPA) and the Global Terrorism Sanctions Regulations, seven counts of 

unlawful transactions with a Specially Designated Global Terrorist, and one count of conspiracy to 

launder monetary instruments. The indictment also indicates that the government will seek a forfeiture 

money judgment equal to the value of any property, real or personal, which constitutes or is derived from 

proceeds traceable to these offenses. According to the indictment, Tajideen allegedly presided over a 

multi-billion-dollar commodity distribution business that operates primarily in the Middle East and Africa 

through a web of vertically integrated companies, partnerships, and trade names. The indictment further 

alleges that Tajideen and others engaged in an elaborate scheme to engage in business with U.S. 

companies while concealing Tajideen’s involvement in those transactions. The Department of the 

Treasury’s Office of Foreign Assets Control (OFAC) named Tajideen a Specially Designated Global 

Terrorist on May 27, 2009. This designation prohibits U.S. companies from transacting unlicensed 
11

business with Tajideen or any companies which are operated for his benefit – in essence stripping 

Tajideen’s global business empire of its ability to legally acquire goods from, or wire money into, the 

United States. However, the indictment alleges that Tajideen restructured his business empire after the 

designation in order to evade the sanctions and continue conducting transactions with U.S. 

entities. Tajideen and others are alleged to have created new trade names and to have misrepresented his 

ownership in certain entities in order to conceal Tajideen’s association. The scheme allowed Tajideen’s 

companies to continue to illegally transact business directly with unwitting U.S. vendors, as well as to 

continue utilizing the U.S. financial and freight transportation systems to conduct wire transfers and move 

shipping containers despite the sanctions against Tajideen. According to the indictment, between 

approximately July of 2013 until the present day, the conspirators illegally completed at least 47 

individual wire transfers, totaling over approximately $27 million, to parties in the U.S. During the same 

time period, the conspirators caused dozens of illegal shipments of goods to leave U.S. ports for the 

benefit of Tajideen, without obtaining the proper licenses from the Treasury Department. Tajideen 

pleaded not guilty and was ordered held pending a detention hearing. The arrest and indictment were the 

result of a two-year investigation led by the Drug Enforcement Administration (DEA) and assisted by 

U.S. Customs and Border Protection (CBP), as well as the Treasury Department’s OFAC and Financial 

Crimes Enforcement Network.

Military-Grade Equipment to Ukraine – On March 7, 2017, in the Eastern District of New York, 

Volodymyr Nedoviz, a citizen of Ukraine and lawful permanent resident of the United States, was 

arrested on federal charges of illegally exporting controlled military technology from the United States to 

end-users in Ukraine in violation of the Arms Export Control Act (AECA) and the International 

Emergency Economic Powers Act (IEEPA). Federal agents also executed a search warrant at a 

Philadelphia, Pennsylvania location that was used in connection with Nedoviz’s illegal scheme. The 

complaint alleges that Nedoviz conspired with others located in both Ukraine and the United States to 

purchase export-controlled, military-grade equipment from sellers in the United States and to export that 

equipment to Ukraine without the required export licenses from the U.S. Departments of Commerce or 

State. The devices obtained by the defendant and his co-conspirators included, among others, an 

Armasight Zeus-Pro 640 2-16x50 (60Hz) Thermal Imaging weapons sight, a FLIR Thermosight R-Series, 

Model RS64 60 mm 640x480 (30Hz) Rifle Scope, and an ATN X-Sight II 5-20x Smart Rifle Scope. In 

many cases, the devices purchased by Nedoviz and his co-conspirators retail for almost $9,000, and they 

are specifically marketed to military and law enforcement consumers. As part of the conspiracy, in order 

to induce U.S.-based manufacturers and suppliers to sell them the export-controlled devices and to evade 

applicable export controls, the defendant and his co-conspirators falsely purported to be United States 

citizens and concealed the fact they were exporters. The defendant and his co-conspirators also recruited, 

trained, and paid other U.S.-based individuals to export the controlled devices to Ukraine via various 

freight forwarding companies. Among other things, the defendant and his co-conspirators instructed the 

U.S.-based individuals to falsely describe the nature and value of the equipment they were attempting to 

export. In addition, to conceal their identities, as well as the true destination of the rifle scopes and 

thermal imaging equipment, Nedoviz and his co-conspirators instructed that the items be shipped using 

false names and addresses. On July 18, 2017, Nedoviz pleaded guilty to one count of violating the AECA. 

On January 11, 2018, Nedoviz was sentenced to time served, 2 years supervised release, and forfeiture of 

$2,500. This case was investigated by the FBI.

Record Fine for Dual-Use Goods to Iran - On March 7, 2017, in the Northern District of Texas, ZTE 

Corporation agreed to enter a guilty plea and to pay a $430,488,798 fine and forfeiture penalty to the 

United States for conspiring to violate the International Emergency Economic Powers Act (IEEPA) by 

illegally shipping U.S.-origin items to Iran, obstructing justice, and making a material false statement. 

ZTE simultaneously reached settlement agreements with the U.S. Department of Commerce’s Bureau of 

Industry and Security (BIS) and the U.S. Department of the Treasury’s Office of Foreign Assets Control 
12

(OFAC). In total ZTE has agreed to pay the U.S. Government $892,360,064. The BIS has suspended an 

additional $300,000,000, which ZTE will pay if it violates its settlement agreement with the BIS. The 

plea agreement also required ZTE to submit to a three-year period of corporate probation, during which 

time an independent corporate compliance monitor will review and report on ZTE’s export compliance 

program. ZTE is also required to cooperate fully with the Department of Justice (DOJ) regarding any 

criminal investigation by U.S. law enforcement authorities. The plea agreement ended a five-year joint 

investigation into ZTE’s export practices, which was handled by DOJ’s National Security Division, the 

U.S. Attorney’s Office for the Northern District of Texas, the FBI, the BIS, and U.S. Immigration and 

Customs Enforcement’s Homeland Security Investigations. A criminal information filed in federal court 

charged ZTE with one count of knowingly and willfully conspiring to violate the IEEPA, one count of 

obstruction of justice, and one count of making a material false statement. ZTE waived the requirement of 

being charged by way of federal indictment, agreed to the filing of the information, and accepted 

responsibility for its criminal conduct by entering into a plea agreement with the government. The plea 

agreement requires that ZTE pay a fine in the amount of $286,992,532 and a criminal forfeiture in the 

amount of $143,496,266. The criminal fine represents the largest criminal fine in connection with an 

IEEPA prosecution. According to documents filed in court, for a period of almost six years ZTE obtained 

U.S.-origin items – including controlled dual-use goods on the Department of Commerce’s Commerce 

Control List (CCL) – incorporated some of those items into ZTE equipment and shipped the ZTE 

equipment and U.S.-origin items to customers in Iran. ZTE engaged in this conduct knowing that such 

shipments to Iran were illegal. ZTE further lied to federal investigators during the course of the 

investigation when it insisted, through outside and in-house counsel, that the company had stopped 

sending U.S.-origin items to Iran. In fact, while the investigation was ongoing, ZTE resumed its business 

with Iran and shipped millions of dollars’ worth of U.S. items there.

Firearms Smuggled to Lebanon - On March 3, 2017, in the Northern District of Iowa, Fadi Yassine, age 

42, a Lebanese citizen, was charged in a one-count Indictment with conspiring to violate the Arms Export 

Control Act (AECA) and to ship, transport, and deal firearms without a license. Yassine was arrested on 

February 5 in New York City as he entered the United States from Lebanon, pursuant to a warrant issued 

in the Northern District of Iowa on a criminal complaint charging him with conspiring to violate the 

AECA. He made an initial appearance in federal court in Cedar Rapids, Iowa, and was ordered detained 

without bond pending trial. According to allegations in the Indictment, Yassine conspired with others, 

including Ali Herz, to ship guns to Lebanon for resale there. The Indictment alleges that firearms were 

shipped to Lebanon from Cedar Rapids on about four occasions during 2014 and 2015. This case is being 

prosecuted by the U.S. Attorney’s Office and was investigated by Homeland Security Investigations, the 

Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Federal Bureau of Investigation. 

Firearms to Russia via Latvia - On Feb. 23, 2017, in the District of Connecticut, Michael Shapovalov 

a/k/a Mikhail Shapovalov was charged by complaint with violating the Arms Export Control Act 

(AECA), smuggling, conspiracy, false statements, and money laundering. Shapovalov is a Russian citizen 

and a legal permanent resident of the United States. The investigation of Shapovalov commenced as a 

result of an investigation conducted by the Federal Security Service (FSB) of the Russian Federation. In 

or about October 2015, the Department of Homeland Security, Homeland Security Investigations (DHSHSI) in New Haven, Connecticut, received information from DHS-HSI in Moscow, Russia, indicating 

that firearms, firearm parts, and ammunition were being shipped from the United States to Latvia via the 

U.S. Postal Service (USPS). Once in Latvia, the packages were then being smuggled into Russia. The 

U.S. shipper of the parcels was identified as Shapovalov. The investigation revealed that since at least 

March 2015, Shapovalov acted as a United States-based intermediary and supplier for a co-conspirator in 

Latvia procuring firearms and firearm components, which are subject to U.S. export controls. The coconspirator directed Shapovalov to make firearms purchases in the United States and ship the items via 

the USPS to Latvia, without an export license. When making these shipments, Shapovalov placed false 
13

descriptions of the items on the Air Waybills and/or the USPS shipping labels that accompanied the 

overseas packages, and failed to complete or submit any required export documents. The co-conspirator 

instructed Shapovalov as to which firearm parts he needed to acquire for Russian and Ukrainian 

customers by providing descriptions of items to purchase or, more often, providing a link to a website 

selling the specific item. Shapovalov, primarily using web-based distributors such as Gunbroker.com and 

eBay, purchased the requested items and had them shipped to his residence; he then repackaged the items 

and mailed them to addresses in Latvia. During the course of the investigation, more than 50 shipments to 

Latvia/Russia were identified as associated with Shapovalov. On Dec. 8, 2017, Michael Shapovalov 

pleaded guilty to a one-count Information charging him with exporting firearms parts without a license, in 

violation of the AECA. He is scheduled to be sentenced in March 2018.

Gun Parts and Accessories to Thailand - On Feb. 16, 2017, in the District of Columbia, Pheerayuth 

Burden, 47, a Thai national who had been living in Torrance, California, was sentenced to 55 months in 

prison for taking part in a conspiracy involving the purchase and shipment of hundreds of gun parts and 

accessories from the United States to Thailand without a license. His company, Wing-On LLC, also was 

sentenced to three years of probation and ordered to pay a $250,000 fine. On Sep. 30, 2016, following a 

trial in the U.S. District Court for the District of Columbia, a jury found Burden and Wing-On LLC guilty 

of one count of conspiracy to violate the Arms Export Control Act and the International Traffic in Arms 

Regulations, one count of unlawful export of defense articles from the United States, and one count of 

conspiracy to commit money laundering. The Honorable Rosemary M. Collyer sentenced Burden and the 

company. Following his prison term, Burden will be placed on three years of supervised release. He and 

the company also were ordered to pay a forfeiture money judgment in the amount of $105,112. A codefendant, Kitibordee Yindeear-Rom, 30, a native and citizen of Thailand, pleaded guilty to a conspiracy 

charge in November 2014. Yindeear-Rom was sentenced in March 2015 to a three-year prison term. 

According to the government’s evidence, beginning at least in or about July 2010, Burden, Wing-On 

LLC, and Yindeear-Rom entered into an agreement to illegally ship United States origin goods, including 

defense articles - specifically gun parts - to Thailand. As part of their agreement, Yindeear-Rom 

purchased gun parts from United States manufacturers through on-line purchases, and directed the 

purchased items to be sent to Burden and Wing-On, which was based in Carson, California, to conceal the 

ultimate destination of the purchases. Upon receipt of the gun parts, the items would be repackaged for 

shipment to Thailand. Extending through at least October 2013 as part of the conspiracy, Burden and 

Yindeear-Rom caused to be purchased and shipped hundreds of different gun parts from the United States 

to Thailand without a license. These gun parts included, for example, numerous firearm parts, including 

key components for AR-15 military-style assault rifles. The jury found that Burden and his company, 

Wing-On LLC, acted without a license and in knowing violation of federal export and money-laundering 

law. This case was investigated by Special Agents for U.S. Immigration and Customs Enforcement, 

Homeland Security Investigations, with assistance provided by the State Department’s Directorate of 

Defense Trade Controls, U.S. Customs and Border Protection, and the U.S. Bureau of Alcohol, Tobacco, 

Firearms, and Explosives. 

Defense Articles to China - On Feb. 15, 2017, in the Central District of California, Tian Min Wu a/k/a 

“Bob Wu,” a citizen of the People’s Republic of China (PRC), was charged in a six-count Indictment with 

purchasing and illegally exporting from the United States defense articles and items subject to the U.S. 

Munitions List (USML) and Commerce Control List (CCL) without an export license. According to the 

Indictment, Wu knowingly and willfully attempted to export from the United States a signals decoder – a 

defense article as defined in Category XI of the USML – without first having obtained a license or 

authorization for the Directorate of Defense Trade Controls (DDTC) of the U.S. Department of State. 

Category XI of the USML includes military electronics and software specifically designed for intelligence 

purposes. Wu also knowingly and willfully attempted to export from the United States to the PRC, 

intending to deliver it to the PRC Government, a satellite modem – a commercial good controlled by the 
14

CCL – without first having obtained a license or authorization from the U.S. Department Commerce. In 

February 2017, Tian Min Wu was arrested in Athens, Greece, under a provisional arrest warrant relating 

to charges contained in the Indictment. Subsequently, the U.S. Department of Justice requested Wu’s 

extradition, and in December 2017 the Greek Court approved his extradition, pending final appeal.

Firearms Parts and Ammunition to the Philippines - On Feb. 15, 2017, in the Central District of 

California, a Long Beach woman pleaded guilty to federal offenses for illegally shipping tens of 

thousands of rounds of ammunition to the Philippines. Marlou Mendoz, 61, pleaded guilty in United 

States District Court to three counts of failing to provide the required written notice to freight forwarders 

that she was shipping ammunition to a foreign country. Marlou Medoza admitted that she sent .22-caliber 

ammunition and bullets to the Philippines in three shipments in June 2011. The shipments contained 

131,300 rounds, the defendant admitted in court. In a related case unsealed in 2016, Mark Louie 

Mendoza, the 31-year-old son of Marlou Mendoza, was charged with illegally shipping hundreds of 

thousands of dollars’ worth of firearms parts and ammunition to the Philippines – munitions that were 

concealed in shipments falsely claimed to be household goods. Mark Mendoza, who remains a fugitive, is 

named in an eight-count indictment that charges him with conspiracy, the unlawful export of munitions, 

smuggling and money laundering. Mark Mendoza, who was the president of a “tools and equipments” 

company known as Last Resort Armaments, ordered more than $100,000 worth of ammunition and 

firearms accessories, much of which was delivered to his parent’s Long Beach residence over a six-month 

period in 2011. The items that Mark Mendoza ordered included parts for M-16 and AR-15-type rifles, and 

these parts are listed as defense articles on the United States Munitions List. Pursuant to the Arms Export 

Control Act, items on the Munitions List may not be shipped to the Philippines without an export license 

issued by the Department of State. The money laundering charge against Mark Mendoza alleges that 

during the first six months of 2011, Mark Mendoza transferred more than $650,000 in proceeds generated 

by the illegal ammunition exports from an account in the Philippines to a money remitter in Los Angeles.

The charges against the Mendozas are the product of an investigation by U.S. Immigration and Customs 

Enforcement’s Homeland Security Investigations (HSI) and the Bureau of Alcohol, Tobacco, Firearms 

and Explosives (ATF). 

Firearms on Hidden Internet Marketplace - On Jan. 30, 2017, in the District of Kansas, Michael 

Andrew Ryan was sentenced to 52 months in prison for his role in a scheme involving the illegal export 

of firearms from the United States using a hidden online marketplace. Michael Andrew Ryan, a/k/a Brad 

Jones and GunRunner, 36, of Manhattan, Kansas, previously pleaded guilty to six counts of exporting and 

attempting to export firearms illegally from the United States to individuals located in other countries on 

June 6, 2016, and was remanded into custody on Oct. 6, 2016. In addition to the prison sentence, U.S. 

District Judge Daniel D. Crabtree ordered Ryan to forfeit all firearms and ammunition seized by law 

enforcement during the investigation. In connection with his plea, Ryan admitted that he used the hidden 

internet marketplace Black Market Reloaded, a website hosted on the Tor network where users can traffic 

anonymously in illegal drugs and other illegal goods, to unlawfully export or attempt to export dozens of 

firearms from the United States to Cork, Ireland; Mallow, Ireland; Pinner, England; Edinburgh, Scotland; 

and Victoria, Australia. These goods included pistols, revolvers, UZIs and Glocks, some from which the 

manufacturer’s serial numbers had been removed, altered or obliterated, as well as magazines and 

hundreds of rounds of ammunition. The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) 

Kansas City Field Division investigated the case with assistance from ATF’s National Investigative 

Division; U.S. Customs and Border Protection; U.S. Immigration and Customs Enforcement’s Homeland 

Security Investigations; and the Manhattan and Riley County, Kansas, Police Departments. 

Production and Development of Nuclear Material for China – On Jan. 6, 2017, in the Eastern District of 

Tennessee, Szuhsiung Ho, a/k/a Allen Ho, a naturalized U.S. citizen, pleaded guilty to conspiracy to 

unlawfully engage or participate in the production or development of special nuclear material outside the 
15

United States, without the required authorization from the U.S. Department of Energy (DOE), in violation 

of the Atomic Energy Act. On August 31, 2017, Ho was sentenced to 24 months in prison and fined 

$20,000. In April 2016, a federal grand jury issued a two-count indictment against Ho; China General 

Nuclear Power Company (CGNPC), the largest nuclear power company in China; and Energy 

Technology International (ETI), a Delaware corporation. At the time of the indictment Ho was a nuclear 

engineer, employed as a consultant by CGNPC, and was also the owner of ETI. CGNPC specialized in 

the development and manufacture of nuclear reactors and was controlled by China’s State-Owned Assets 

Supervision and Administration Commission. According to documents filed in the case, beginning in 

1997 and continuing through April 2016, Ho conspired with others to engage or participate in the 

development or production of special nuclear material in China, without specific authorization to do so 

from the U.S. Secretary of Energy, as required by law. Ho assisted CGNPC in procuring U.S.-based 

nuclear engineers to assist CGNPC and its subsidiaries with designing and manufacturing certain 

components for nuclear reactors more quickly by reducing the time and financial costs of research and 

development of nuclear technology. In particular, Ho sought technical assistance related to CGNPC’s 

Small Modular Reactor Program; CGNPC’s Advanced Fuel Assembly Program; CGNPC’s Fixed In-Core 

Detector System; and verification and validation of nuclear reactor-related computer codes. Under the 

direction of CGNPC, Ho also identified, recruited, and executed contracts with U.S.-based experts from 

the civil nuclear industry who provided technical assistance related to the development and production of 

special nuclear material for CGNPC in China. Ho and CGNPC also facilitated travel to China for and 

payments to the U.S.-based experts in exchange for their services. This investigation was conducted by 

the FBI, Tennessee Valley Authority-Office of the Inspector General, DOE-National Nuclear Security 

Administration and U.S. Immigration and Customs Enforcement Homeland Security Investigations, with 

assistance from other agencies. 

Munitions to Egypt – On Dec. 16, 2016, AMA United Group, Malak Neseem Swares Boulos and Amged 

Kamel Yonan Tawdraus were each sentenced in the Eastern District of New York after pleading guilty on 

April 1, 2015, to violating the Arms Export Control Act, in connection with the attempted shipment of 

munitions samples from New York City to Egypt. AMA United Group, an Egyptian procurement agent, 

entered a guilty plea to violating the Arms Export Control Act. Boulos and Tawdraus, Egyptian citizens 

and partners in AMA United Group, pleaded guilty to failing to file required export information relating 

to the international shipment of a landmine and multiple bomblet bodies. AMA United Group was 

sentenced to one year of probation and $400 special assessment. Boulos and Tawdraus were each 

sentenced to three years and six months home confinement, $100 special assessment and a fine of $2,500. 

According to court filings and facts presented during the plea proceeding, Boulos and Tawdraus were 

arrested after attempting to close a deal to acquire and export the items, which were included on the U.S. 

Munitions List and regulated by the U.S. Department of State. Beginning in Feb. 2011, the defendants 

began trying to obtain munitions items on behalf of AMA United Group’s client, a factory in Cairo. The 

items the defendants sought included a landmine as well as bomblet bodies and “trumpet liners,” two 

components that are integral to manufacturing the housings for explosives in an aerial warhead. In July

2011, the defendants traveled from Cairo to New York City to inspect the items. On July 1, 2011, the 

three principals of AMA United Group attempted to ship samples to its client in Egypt. Boulos and 

Tawdraus failed to file any export information in connection with the attempted shipment. The 

requirement to file accurate information regarding the contents of international shipments is one layer of 

regulatory oversight pertaining to protecting the U.S. national security and diplomatic interests. This case 

was investigated by the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations 

(ICE-HSI) and the Defense Criminal Investigative Service (DCIS).

Trade Secrets for Technologically Advanced Titanium to China – On Dec. 16, 2016, in the District of 

Connecticut, Yu Long, a citizen of China and lawful permanent resident of the U.S., waived his right to 

be indicted and pleaded guilty to charges related to his theft of numerous sensitive military program 
16

documents from United Technologies and transporting them to China. Long pleaded guilty to one count 

of conspiracy to engage in the theft of trade secrets knowing that the offense would benefit a foreign 

government, foreign instrumentality or foreign agent. He also pleaded guilty to one count of unlawful 

export and attempted export of defense articles from the U.S., in violation of the Arms Export Control 

Act. On June 27, 2017, Yu Long was sentenced to time served and a special assessment of $200.

Previously, on Nov. 7, 2014, Long was arrested in Ithaca, NY, pursuant to a federal criminal complaint 

which charged Long with attempting to travel to China with sensitive proprietary documents that set forth 

detailed equations and test results used in the development of technologically advanced titanium for U.S. 

military aircraft. The documents were taken from a Connecticut defense contractor where Long had been 

employed. Long attempted, two days earlier, to fly to China from Newark Liberty International Airport 

in New Jersey. As alleged in the complaint affidavit and in statements made in court, Long holds Chinese 

citizenship and is a lawful permanent resident of the U.S. From approximately Aug. 2008, to May 2014, 

Long worked as a Senior Engineer/Scientist at a research and development center for a major defense 

contractor in Connecticut (“Company A”). Both during and after his employment there, Long traveled to 

the People’s Republic of China. Most recently, on Aug. 19, 2014, Long returned to the U.S. from China 

through John F. Kennedy International Airport in New York. During a secondary inspection screening by 

U.S. Customs and Border Protection (CBP) officers, Long was found in the possession of $10,000.00 in 

undeclared U.S. cash, registration documents for a new corporation being set up in China, and a largely 

completed application for work with a state-controlled aviation and aerospace research center in China. 

The application materials highlighted certain of Long’s work history and experiences that he claimed to 

have obtained while employed at Company A, including work on F119 and F135 engines. The F119 

engine is employed by the U.S. Air Force F-22 Raptor fighter aircraft. The F135 engine is employed by 

the U.S. Air Force F-35 Lightning II fighter aircraft. The criminal complaint and statements made in court

further state that on Nov. 5, 2014, Long boarded a flight from Ithaca to Newark Liberty International 

Airport, with a final destination of China. During Long’s layover in Newark, CBP officers inspected 

Long’s checked baggage and discovered that it contained, among other things, sensitive, proprietary and 

export controlled documents from another major defense contractor located outside the state of 

Connecticut (“Company B”). Further investigation determined that the U.S. Air Force had convened a 

consortium of major defense contractors, including Company A and Company B, to work together to see 

whether they could collectively lower the costs of certain metals used. As part of those efforts, members 

of the consortium shared technical data, subject to stringent restrictions on further dissemination. 

Company B reviewed the Company B documents found in Long’s possession at Newark Liberty Airport 

and confirmed that it provided the documents to Company A as part of the consortium. Company B 

further confirmed that Long was never an employee of Company B. A review of Company A’s computer 

records indicated that Long had printed the documents while employed at Company A. The documents 

bore warnings that they contained sensitive, proprietary and export-controlled material, which could not 

be copied or communicated to a third party. This investigation was conducted by the FBI, HSI, and CBP.

Prohibited Financial Transactions in Iran – On Dec. 15, 2016, in the District of Alaska, Kenneth Zong 

was named as the sole defendant in the 47-count indictment charging him with conspiracy to violate the 

International Emergency Economic Powers Act (IEEPA), unlawful provision of services to Iran, money 

laundering conspiracy and money laundering. The indictment alleged that at an undetermined time, Zong 

left Alaska for Seoul, South Korea, and operated businesses there. From Jan. 2011, through at least April

2014, Zong and four co-conspirators – three Iranian nationals and one U.S. citizen – allegedly conspired 

to evade the prohibitions of IEEPA and Iranian Transactions and Sanctions Regulations (ITSR) by 

engaging in false, fictitious and fraudulent transactions which were designed to unlawfully convert and 

remove Iranian owned funds, equivalent to approximately $1 billion United States dollars (USD). These 

funds were held in controlled Korean bank accounts and converted into more easily tradeable currencies, 

such as dollars and/or euros, by defrauding the Korean regulators into thinking the transactions were 

legitimate. Zong is charged with transferring those currencies to more than 10 countries around the 
17

world, including the U.S., United Arab Emirates, Switzerland, Germany, Austria and Italy. Zong received 

payment for these acts from the Iranian nationals in an amount from $10 million to $17 million USD. 

The indictment alleged that the scheme began in 2011, when Zong changed the name of his Korean 

company, “KSI Ejder, Inc.” (KSI) to “Anchore.” Zong used KSI/Anchore as a conduit to convert and 

distribute Iranian funds into USD and/or euros, by fictitiously selling marble tiles and other construction 

supplies to an Iranian shell company in Kish Island, Iran. KSI/Anchore fictitiously purchased Italian 

marble tiles and other construction supplies from “MSL & Co Investment Trading” (MSL Investment 

Dubai), an Iranian-controlled shell company in Dubai, which were then fictitiously shipped directly to 

another fictitious company in Iran. Zong and his co-conspirators created false and fictitious contracts, 

bills of lading and invoices to show Korean government banking regulators that the Iranian company 

owed KSI/Anchore for the false marble purchases. This resulted in the transfer of Iranian funds, at the 

direction of Zong’s co-conspirators, from the restricted Iranian bank account to Zong’s KSI/Anchore 

account. Zong then transferred the funds to entities and individuals throughout the world. Zong is also 

charged with 43 counts of money laundering and one count of money laundering conspiracy for his 

actions in connection with the $10 million fee paid to him by his Iranian associates. In furtherance of the 

scheme, Zong transferred $10 million of his fees from Korea to a co-conspirator who resided in 

Anchorage. This individual also created and operated various companies to be used as front companies to 

purchase real estate, automobiles, an interest in a yacht and other purchases or transfers of the Iranian 

funds. The U.S. embargo on Iran, which is enforced through IEEPA and the ITSR, prohibits the export of 

goods, technology, and services to Iran with very limited exceptions. This case was investigated by the 

IRS-Criminal Investigation and the FBI.

Components for IEDs to Iran and Iraq – On Dec. 15, 2016, in the District of Columbia, Lim Yong Nam, 

a/k/a Steven Lim, a citizen of Singapore, pleaded guilty to a federal charge stemming from his role in a 

conspiracy that allegedly caused thousands of radio frequency modules to be illegally exported from the 

U.S. to Iran. At least 16 of the components were later found in unexploded improvised explosive devices 

(IEDs) in Iraq. Lim was extradited from Indonesia, where he had been detained since Oct. 2014, in 

connection with the U.S. request for extradition. He pleaded guilty to a charge of conspiracy to defraud 

the U.S. by dishonest means. On April 27, 2017, Lim was sentenced to 40 months in prison. Lim and 

others were indicted in the District of Columbia in June 2010, on charges involving the shipment of radio 

frequency modules made by a Minnesota-based company. The modules have several commercial 

applications, including in wireless local area networks connecting printers and computers in office 

settings. These modules include encryption capabilities and have a range allowing them to transmit data 

wirelessly as far as 40 miles when configured with a high-gain antenna. These same modules also have 

potentially lethal applications. Notably, during 2008 and 2009, coalition forces in Iraq recovered 

numerous modules made by the Minnesota firm that had been utilized as part of the remote detonation 

system for IEDs. According to the plea documents filed, between 2001 and 2007, IEDs were the major 

source of American combat casualties in Iraq. In his guilty plea, Lim admitted that between Aug. 2007,

and Feb. 2008, he and others caused 6,000 modules to be purchased and illegally exported from the 

Minnesota-based company through Singapore, and later to Iran, in five shipments, knowing that the 

export of U.S.-origin goods to Iran was a violation of U.S. law. In each transaction, Lim and others made 

misrepresentations and false statements to the Minnesota firm that Singapore was the final destination of 

the goods. At no point in the series of transactions did Lim or any of his co-conspirators inform the 

company that the modules were destined for Iran. Similarly, according to the statement of offense, Lim 

and others caused false documents to be filed with the U.S. government, in which they claimed that 

Singapore was the ultimate destination of the modules. Lim and his co-conspirators were directly aware 

of the restrictions on sending U.S.-origin goods to Iran. Shortly after the modules arrived in Singapore, 

they were kept in storage at a freight forwarding company until being aggregated with other electronic 

components and shipped to Iran. There is no indication that Lim or any of his co-conspirators ever took 

physical possession of these modules before they reached Iran or that they were incorporated into another 
18

product before being re-exported to Iran. According to the statement of offense, 14 of the 6,000 modules 

the defendants routed from Minnesota to Iran were later recovered in Iraq, where the modules were being 

used as part of IED remote detonation systems. This investigation was jointly conducted by ICE 

Homeland Security Investigations (HSI) and the Department of Commerce, Bureau of Industry and 

Security. Substantial assistance was provided by the U.S. Department of Defense, U.S. Customs and 

Border Protection, the State Department’s Directorate of Defense Trade Controls, the Treasury 

Department’s Office of Foreign Assets Control, and the Office of International Affairs in the Justice 

Department’s Criminal Division, the Justice Department Attaché in the Philippines and the FBI and HSI 

Attachés in Singapore and Jakarta.

Aviation Parts and Supplies to Iran – On Dec. 14, 2016, in the District of Columbia, Mansour 

Moghtaderi Zadeh, an Iranian national, was sentenced to 18 months in prison and one year of supervised 

release for taking part in a conspiracy involving the purchase and shipment of various products, including 

aviation parts and aviation supplies, from the U.S. to Iran without a license. Zadeh was also ordered to 

pay a forfeiture money judgment in the amount of $69,159.00. Zadeh, who had been living in Iran, 

pleaded guilty on Oct. 27, 2016, to one count of conspiracy to unlawfully export goods, technology and 

services to Iran without the required license, and to defraud the U.S., in violation of 18 U.S.C. § 371, 50 

U.S.C. § 1705, and 31 C.F.R. Parts 560.203 and 560.204. In court documents filed at the time of the plea, 

Zadeh acknowledged that beginning in Oct. 2005, Iranian companies requested that Zadeh through his 

company, Barsan, procure products including a fiber optic video transmitter and receiver, and aviation 

course indicators that would otherwise require a license from the Office of Foreign Assets Control 

(OFAC) to be exported to Iran. Members of the conspiracy arranged for the items to be sent from the U.S. 

to Iran, for which Zadeh received a commission. In March 2007, Zadeh and co-conspirators attempted to 

export metal sheets and rods that are used in the aviation manufacturing industry from the U.S. to Iran 

without the required license from OFAC. Zadeh had arranged for his new corporation, Lavantia, to 

purchase the items. Zadeh also used an alias in his communications. In Sep. 2007, the shipment was 

detained by the U.S. Department of Commerce pending certification of the end user. In Oct. 2007, the 

Department of Commerce issued a Temporary Denial Order (TDO) against Lavantia and Zadeh, under his 

alias. The TDO prohibited Lavantia and Zadeh from participating in any way in exporting commodities 

from the U.S. Notwithstanding the TDO, Zadeh and other conspirators exported and attempted to export 

numerous materials from the U.S., including resin, sealant, paint, pneumatic grease, film adhesive and 

polyurethane coating and thinner. The post-TDO conduct included more than $69,000 of exported goods. 

This investigation was conducted by the U.S. Immigration and Customs Enforcement’s Homeland 

Security Investigations, and the Bureau of Industry and Security at the U.S. Department of Commerce.

Cutting-Edge Microelectronics to Russia – On Dec. 6, 2016, in the Eastern District of New York, 

Alexey Barysheff of Brooklyn, New York, a naturalized citizen of the United States, was arrested on 

federal charges of illegally exporting controlled technology from the United States to end-users in 

Russia. Simultaneously, two Russian nationals, Dmitri Aleksandrovich Karpenko and Alexey Krutilin, 

were arrested in Denver, Colorado, on charges of conspiring with Barysheff and others in the 

scheme. Federal agents also executed search warrants at two Brooklyn locations that were allegedly used 

as front companies in Barysheff’s illegal scheme. Barysheff made his initial appearance on Dec. 6, 

2016, in the Eastern District of New York. Karpenko and Krutilin made their initial appearances on Dec. 

6, 2016, in the District of Colorado. On Dec. 18, 2016, the Court ordered their removal in custody to the 

Eastern District of New York. The complaints allege that Barysheff, Karpenko, Krutilin, and others were 

involved in a conspiracy to obtain cutting-edge microelectronics from manufacturers and suppliers 

located within the United States and to export those high-tech products to Russia, while evading the 

government licensing system set up to control such exports. The microelectronics shipped to Russia 

included, among other products, digital-to-analog converters and integrated circuits, which are frequently 

used in a wide range of military systems, including radar and surveillance systems, missile guidance 
19

systems and satellites. These electronic devices required a license from the Department of Commerce to 

be exported to Russia and have been restricted for anti-terrorism and national security reasons. As further 

detailed in the complaints, in 2015 Barysheff registered the Brooklyn, New York-based companies BKLN 

Spectra, Inc. (Spectra) and UIP Techno Corp. (UIP Techno). Since that time, the defendants and others 

have used those entities as U.S.-based front companies to purchase, attempt to purchase, and illegally 

export controlled technology. To induce U.S.-based manufacturers and suppliers to sell them high-tech, 

export-controlled microelectronics and to evade applicable controls, the defendants and their coconspirators purported to be employees and representatives of Spectra and UIP Techno and provided false 

end-user information in connection with the purchase of the items, concealed the fact that they were 

exporters and falsely classified the goods they exported on records submitted to the Department of 

Commerce. To conceal the true destination of the controlled microelectronics from the U.S. suppliers, the 

defendants and their co-conspirators shipped the items first to Finland and subsequently to Russia. On 

March 2, 2017, Barysheff pleaded guilty to submitting false export information; on Oct. 19, 2017, 

Barysheff was sentenced to time served. Karpenko and Krutilin pleaded guilty to conspiracy to violate 

IEEPA; they were sentenced to time served and were ordered removed from the United States on May 2, 

2017. This case was investigated by ICE-HSI, FBI, Department of Commerce-BIS, and DoD DCIS.

Controlled Microelectronics to Russian Military and Intelligence Agencies – On Dec. 1, 2016, Shavkat 

Abdullaev was sentenced in the Eastern District of New York to 36 months’ imprisonment, 2 years 

supervised release, and $400 special assessment. On Feb. 28, 2017, Alexander Posobilov was sentenced 

to 135 months in prison. Previously, on July 21, 2016, Alexander Fishenko, a dual citizen of the United 

States and Russia, was sentenced to 120 months’ imprisonment and ordered to forfeit more than $500,000 

in criminal proceeds following his guilty plea on Sept. 9, 2015, to a nineteen-count indictment. Fishenko 

was charged with acting as an agent of the Russian government within the United States without prior 

notification to the Attorney General, conspiring to export, and illegally exporting controlled 

microelectronics to Russia, conspiring to launder money, and obstruction of justice. Fishenko, ten other 

individuals, and two corporations – ARC Electronics, Inc. (ARC) and Apex System, L.L.C. (Apex) –

were indicted in Oct. 2012. On Oct. 26, 2015, Alexander Posobilov, Shavkat Abdullaev and Anastasia 

Diatlova were convicted of all counts of the indictment. On Jan. 10, 2013, defendants Lyudmila 

Bagdikian and Viktoria Klebanova pleaded guilty for their roles in exporting goods from the United 

States to Russian end users. Three defendants remain at large. ARC is now defunct, and Apex, a Russianbased procurement firm, failed to appear in court. Previously, on Oct. 3, 2012, an indictment was 

unsealed in the Eastern District of New York charging 11 members of a Russian procurement network 

operating in the United States and Russia, as well as a Houston-based export company, Arc Electronics 

Inc., and a Moscow-based procurement firm, Apex System L.L.C., with illegally exporting high-tech 

microelectronics from the United States to Russian military and intelligence agencies. Fishenko, an 

owner and executive of both the American and Russian companies, was also charged with operating as an 

unregistered agent of the Russian government inside the U.S. by illegally procuring the microelectronics 

on behalf of the Russian government. The microelectronics allegedly exported to Russia are subject to 

U.S. controls due to their potential use in a wide range of military systems, including radar and 

surveillance systems, weapons guidance systems and detonation triggers. In conjunction with the 

unsealing of the charges, the Department of Commerce added 165 foreign persons and companies who 

received, transshipped, or otherwise facilitated the export of controlled commodities by the defendants to 

its "Entity List." As alleged in the indictment, between Oct. 2008, and the present, Fishenko and the other 

defendants engaged in a conspiracy to obtain advanced microelectronics from manufacturers and 

suppliers located in the United States and to export those high-tech goods to Russia, while evading the 

government export licensing system. The microelectronics shipped to Russia included analog-to-digital 

converters, static random access memory chips, microcontrollers and microprocessors. The defendants 

allegedly exported many of these goods, frequently through intermediary procurement firms, to Russian 

end users, including Russian military and intelligence agencies, and went to great lengths to conceal their 
20

procurement activities. The investigation uncovered a Russian Ministry of Defense document designating 

an Apex subsidiary as a company "certified" to procure and deliver military equipment and electronics. 

The FBI recovered a letter sent by a specialized electronics laboratory of Russia's Federal Security 

Service (FSB), Russia's primary domestic intelligence agency, to an Apex affiliate regarding certain 

microchips obtained for the FSB by Arc. The defendants' principal port of export for these goods was 

John F. Kennedy International Airport in New York. In addition to Fishenko, Arc, Apex, Posobilov, 

Abdullaev and Diatlova, the indictment also charged Sevinj Taghiyeva and Svetalina Zagon, who were 

arrested in Houston on Oct. 2 and Oct 3, 2012. Three others charged in the indictment, Sergey Klinov, 

Yuri Savin, and Dimitriy Shegurov, were based overseas and were not arrested. The investigation was 

conducted by the FBI, Department of Commerce (BIS), Naval Criminal Investigative Service (NCIS) and 

the IRS.

Assault Rifles to Haiti – On Dec. 1, 2016, an indictment was returned in the Southern District of Florida 

charging both Samuel Baptiste and Jose Noel a/k/a Abdul Jabar, a citizen of Haiti, with smuggling goods 

from the United States. The indictment also charged Noel with being an alien in possession of a firearm 

and Baptiste with being a felon in possession of a firearm. The investigation of Baptiste began in April

2014, when investigating agents observed that Baptiste operated numerous social media accounts praising 

U.S. designated terrorists Usama bin Laden and Anwar Al-Awlaki, in addition to encouraging jihad and 

referencing becoming a martyr. The FBI assessed that Baptiste used his social media accounts since at 

least 2013 to disseminate extremist propaganda, to praise attacks conducted or inspired by Al Qaeda, and 

to promote travel to Syria for jihad. In mid-Oct. 2016, FBI agents launched an investigation of Noel 

based on information provided by a FBI Confidential Human Source (CHS). The CHS was first 

introduced to Noel through a mutual associate, Baptiste, in Oct. 2016. During a meeting between Baptiste, 

Noel and the CHS, Noel indicated a desire to obtain a T-56 rifle. Noel stated that he had previously 

obtained illegal guns from family members in Florida and further claimed to have transported concealed 

weapons to Haiti in the past. Noel also told the CHS about a security company he was trying to establish 

in Haiti and his desire to obtain guns for this company. During one of the meetings between the CHS, 

Baptiste and Noel, Noel advised the CHS that he (Noel) needed a 9mm handgun and also wanted to 

purchase an AR-15 assault rifle. On Nov. 5, 2016, Baptiste, Noel and the FBI CHS went to a shipping 

container acquired by the CHS. The CHS told Baptiste and Noel that the container was scheduled to be 

shipped to Haiti. Inside the container were FBI-acquired items that resembled relief items to be shipped 

to Haiti. Among the items were pallets of food, clothing, vehicle tires, and household appliances. Also 

placed inside the container concealed under clothing were two FBI-provided rifles – two Rock River 

Arms LAR-15 semi-automatic assault rifles – and four ammunition magazines for those rifles. The 

weapons were provided to Noel based on his requests to the FBI CHS to obtain AR-15-style rifles for 

him. Noel paid the CHS $300 in case for one of the weapons. On March 30, 2017, Noel pleaded guilty to 

being an alien in possession of a firearm; on May 30, 2017, he was sentenced to 16 months in prison. On 

March 31, 2017, Baptiste pleaded guilty to being a felon in possession of a firearm; on June 21, 2017, he 

was sentenced to 80 months in prison. This case was investigated by the FBI.

Sanctions Violations to Aid Iran – On Nov. 21, 2016, in the Eastern District of New York, Ahmad 

Sheikhzadeh, a U.S. citizen and resident of New York City, pleaded guilty to filing a false income tax 

return that substantially understated the amount of cash salary the defendant received from Iran’s 

Permanent Mission to the United Nations (IMUN) and conspiring to facilitate the transfer of funds to Iran 

without the required license from the Treasury Department, in violation of the International Emergency 

Economic Powers Act (IEEPA). According to court filings and facts presented during the plea 

proceeding, beginning in Jan. 2008, Sheikhzadeh was employed as a consultant to the IMUN and received 

a regular salary, in cash, approximately once per month, through an intermediary who was an official at 

the IMUN. Sheikhzadeh was not a declared IMUN official. From 2008 through 2012, Sheikhzadeh filed 

personal income tax returns that substantially understated the amount of income he received from his 
21

work for the IMUN. In addition, distinct from his work for the IMUN, Sheikhzadeh provided money 

remitting (“hawala”) services to co-conspirators in the U.S. to facilitate investments in Iran and to direct 

disbursements from Iranian bank accounts. Sheikhzadeh engaged in these money transfers without a 

license from the Treasury Department’s Office of Foreign Assets Control, in violation of IEEPA. 

Sheikhzadeh is to be sentenced in February 2018. When sentenced, the defendant faces up to 23 years in 

prison. The defendant has agreed to pay over $147,000 in restitution and forfeiture. This case is 

investigated by the FBI and the IRS Criminal Investigation Division in New York.

Integrated Circuits to China – On Nov. 4, 2016, in the District of Connecticut, Xianfeng Zuo of 

Shenzhen, China, was sentenced to 15 months of imprisonment for conspiring to sell counterfeits of 

sophisticated integrated circuits (ICs) to a purchaser in the U.S. According to court documents and 

statements made in court, Zuo, Jiang Yan and Daofu Zhang each operated businesses in China that bought 

and sold electronic components, including ICs. In the summer of 2015, Zuo asked Yan to locate and 

purchase several advanced ICs made by Xilinx Corp., which had military applications, including radiation 

tolerance for uses in space. Yan then asked a U.S. individual to locate the Xilinx ICs and sell them to 

Yan. The U.S. individual explained that the ICs cannot be shipped outside the U.S. without an export 

license, but Yan still wished to make the purchase. When the U.S. individual expressed concern that the 

desired ICs would have to be stolen from military inventory, Yan proposed to supply the U.S. source with 

“fake” ICs that “look the same,” to replace the ones to be stolen from the military. In Nov. 2015, Zhang 

shipped from China to the U.S. individual, two packages containing a total of eight counterfeit ICs, each 

bearing a counterfeit Xilinx brand label. After further discussions between Yan and the U.S. individual, 

Yan, Zhang, and Zuo flew together from China to the U.S. in early Dec. 2015, to complete the Xilinx ICs 

purchase. On Dec. 10, 2015, the three conspirators drove to a location near Route 95 in Milford, 

Connecticut, where they planned to meet the U.S. individual, make payment, and take custody of the 

Xilinx ICs. Federal agents arrested all three at the meeting location. The defendants were charged under 

separate indictments in the District of Connecticut. On March 7, 2016, Yan pleaded guilty both to 

conspiracy to traffic in counterfeit military equipment, in violation of 18 U.S.C. § 2320(a)(3); and to 

attempted, unlicensed export of advanced, export-restricted electronic equipment, in violation of the 

International Emergency Economic Powers Act, 50 U.S.C. §§ 1701 et seq. Yan was sentenced on Dec. 

29, 2016, to time–served. On March 16, 2016, Zuo pleaded guilty to one count of conspiracy to traffic in 

counterfeit goods, in violation of 18 U.S.C. § 2320(a). On April 15, 2016, Zhang also pleaded guilty to 

one count of conspiracy to traffic in counterfeit goods. Zhang was sentenced on July 8, 2016, to 15 

months of imprisonment. As part of their sentences, each defendant was ordered to forfeit his interest in 

the $63,000 in cash seized incident to their arrests. This matter was investigated by the Defense Criminal 

Investigative Service, the Department of Homeland Security, the Department of Commerce, the Federal 

Bureau of Investigation, and the Air Force Office of Special Investigations.

Firearm Parts to the Philippines – On Nov. 2, 2016, Kirby Santos of the Republic of the Philippines was 

sentenced in the District of New Jersey to 24 months’ imprisonment, 3 years supervised release, $100 

special assessment and $2,400 fine after pleading guilty on Oct. 7, 2015, to an information charging him 

with one count of conspiracy to violate the Arms Export Control Act and U.S. anti-smuggling laws. 

According to the documents filed in this case, other cases and statements made in court: Santos admitted 

that from 2008 through Oct. 2013, he and conspirators he met in the Philippines or through an online 

forum agreed to ship firearms parts from the United States to the Philippines. Santos and others used 

credit cards and other forms of payment to purchase firearms parts from suppliers in the United States. 

Knowing that they would not ship to the Philippines, Santos arranged for the suppliers to send the 

firearms parts to the addresses of conspirators in Toms River, New Jersey, and Lynwood, Washington, in 

order to make the purchases appear as domestic sales. At the direction of Santos, the conspirators, 

including Abelardo Delmundo, 53, of Toms River, New Jersey, would then repackage the firearms parts, 

falsely label the contents of the package and export the firearms parts to the Philippines for ultimate 
22

delivery to Santos. To disguise their role in the conspiracy, the conspirators used aliases when sending the 

packages containing prohibited items. Upon receiving the firearms parts, Santos paid Delmundo and other 

conspirators in the form of cash or wire transfers to others at their direction. During the course of the 

nearly five-year long conspiracy, Santos and others purchased and directed the unlawful exportation of 

more than $200,000 worth of defense articles from the United States to the Philippines without the 

required export license. Santos made his initial appearance in federal court on April 22, 2015, after being

charged by criminal complaint with one count of conspiracy to violate the Arms Export Control Act and 

U.S. anti-smuggling laws. The Arms Export Control Act prohibits the export of defense articles and 

defense services without first obtaining a license from the U.S. Department of State and is one of the 

principal export control laws in the United States. Santos was arrested in Guam on March 31, 2015, by 

special agents of the U.S. Department of Homeland Security-Homeland Security Investigations (DHSHSI) and the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF). Delmundo, charged in the 

District of New Jersey under a separate information, pleaded guilty to his role in the conspiracy on April

30, 2015. This investigation was conducted by DHS-HSI, ATF.

Firearms and Ammunition to Ghana – On Nov. 2, 2016, in the Western District of North Carolina, 

Richmond Akoto Attah was sentenced to 37 months of imprisonment, one year supervised release, and 

$100 special assessment stemming from his plea of guilty on June 7, 2016, to smuggling goods from the

United States. On Feb. 16, 2016, a nine count indictment was returned charging Attah with one count of 

violating the Arms Export Control Act (AECA), one count of illegal firearms dealing, two counts of 

smuggling goods from the United States and four counts of making false statements to a firearms 

dealer. According to the indictment, beginning in at least 2013, Attah purchased numerous firearms and 

ammunition he intended to smuggle and illegally export to Ghana, West Africa. Attah obtained the 

firearms by misstating on the required federal forms that he was the actual buyer and transferee of the 

firearms. According to the indictment, Attah was not a federally licensed firearms dealer and did not 

possess a license to export firearms or ammunition to Ghana or any other country. The indictment further 

alleged that from on or about Sep. 2013, to Dec. 2015, Attah purchased approximately 63 firearms and 

3,500 rounds of ammunition from various stores, internet vendors and at gun shows. On or about Sep. 4, 

2015, Attah travelled from Charlotte to Ghana, returning on Oct. 10, 2015. During his return trip, Attah 

hid $30,100 dollars in his luggage, falsely declaring on his customs paperwork that he was only bringing 

$350 back into the United States. The indictment also alleged that from on or about Nov. 2015, to Dec.

13, 2015, Attah purchased approximately 22 firearms and ammunition from dealers in North Carolina and 

online. Attah then hid 27 firearms, including semi-automatic pistols and revolvers, inside a washing 

machine and a dryer, and 3,500 rounds of ammunition inside a barrel. Attah placed the washer, dryer, 

and barrel inside a shipping container and attempted to have it shipped from Charlotte to 

Ghana. According to court documents, U.S. Customs officers recovered the firearms and ammunition 

before they were shipped outside the United States. This case was investigated by ATF, FBI, ICE HSI 

and CBP.

Military Aircraft Parts to Iran – On Oct. 26, 2016, in the Central District of California, Zavik Zargarian 

and Vache Nayirian were arrested on federal charges for their alleged role in a scheme to smuggle 

millions of dollars’ worth of military aircraft parts and other potential defense items to Iran, in violation 

of the International Emergency Economic Powers Act (IEEPA) and the Iranian Transactions and 

Sanctions Regulations (ITSR). The defendants were taken into custody by special agents of U.S. 

Immigration and Customs Enforcement’s HSI. The men are among five defendants charged in a ninecount federal indictment unsealed on Oct. 26, 2016, that alleged a conspiracy to purchase and ship more 

than $3 million dollars’ worth of jet fighter aircraft parts to Iran. Additionally, several of the defendants 

are accused of buying and illegally exporting fluorocarbon rubber O-rings to Iran. The O-rings in question 

have a variety of possible military applications, including use in aircraft hydraulic systems and landing 

gear. Also named in the indictment are Zargarian’s Glendale-based company, ZNC Engineering, and two 
23

Iranian nationals, Hanri Terminassian, and Hormoz Nowrouz, both of whom are believed to be in Iran. 

The charges stem from a lengthy undercover probe spearheaded by HSI, with substantial assistance 

provided by the Defense Criminal Investigative Service and U.S. Customs and Border Protection (CBP). 

According to the indictment, Terminassian originally contacted Zargarian from Iran for assistance with 

obtaining military aircraft parts from U.S.-based suppliers. Subsequently, Zargarian negotiated on 

Terminassian’s behalf to purchase the desired items from an undercover HSI special agent who was 

posing as a parts supplier. The items included parts used in F-14, F-15, F-16 and F-18 fighter jets. 

Eventually, Terminassian traveled to the U.S. to meet with Zargarian and the undercover special agent to 

discuss the transaction. The indictment alleged the two men sought to purchase between 10 and 30 units 

of each item, with the total cost potentially exceeding $3.6 million. The indictment also accuses 

Zargarian and Nayirian of conspiring with Terminassian and Nowrouz to export fluorocarbon rubber Orings to Iran. The indictment alleged Terminassian contacted Nayirian and Zargarian on behalf of 

Nowrouz and sought their help to obtain the parts. Terminassian transferred funds for the purchase to 

Nayirian, who later provided the money to Zargarian. Through his company ZNC Engineering, Zargarian 

bought the O-rings from a California vendor and provided them to Nayirian. Nayirian then exported the 

O-rings to addresses in the United Arab Emirates and Kuwait provided by Terminassian, who 

subsequently arranged for them to be transshipped to Iran. According to the indictment, the defendants 

exported more than 7,000 O-rings to Iran over the course of the conspiracy. To reduce the likelihood of 

detection, the defendants falsely claimed on shipping documents that the O-rings were destined for 

countries other than Iran and substantially undervalued them to avoid having to file export forms that 

might prompt further inspection by CBP. As part of their probe, investigators obtained evidence that the 

O-rings were intended for the Iranian Air Force. Zargarian and Nayirian were arraigned on the 

indictment in federal court on Oct. 26, 2016. Both men entered not guilty pleas. On April 17, 2017, 

Zargarian pleaded guilty to conspiracy to violate IEEPA. This case was investigated by ICE-HSI.

Protected Rice Seeds to China – On Oct. 26, 2016, in the District of Kansas, Wengui Yan pleaded guilty 

to one count of making false statements to the FBI while working as a geneticist for the U.S. Department 

of Agriculture at the Dale Bumpers National Research Center in Stuttgart, Arkansas. Yan, a scientist who 

worked with rice, admitted that he knew about plans to steal samples and send them to China. In his plea, 

Yan admitted that on Aug. 7, 2013, agents of U.S. Customs and Border Protection found stolen seeds in 

the luggage of a group of visitors from China preparing to board a plane to return home. The group had 

visited the facility in Stuttgart. Yan admitted that before the Chinese group arrived, a co-defendant in 

Kansas had asked him for seeds and Yan had declined because the seeds were protected. The codefendant told Yan about other individuals seeking to steal samples of the seeds. When the delegation 

came to Stuttgart, Yan traveled with them to a rice farm where he knew they would have an opportunity 

to steal seeds. After the theft, Yan denied knowing about the plans to steal the seeds or about the theft 

itself. Investigators also learned that Yan attempted to cover up a trip he made to China to visit the crops 

research institute that sent the delegation to the United States. Co-defendant Weiqiang Zhang was 

convicted at trial in February 2017. Both defendants are awaiting sentencing. This case was investigated 

by the FBI and CBP.

Restricted Laboratory Equipment to Syria – On Oct. 25, 2016, in the Middle District of Pennsylvania, 

Ahmad Feras Diri of London, was sentenced to 37 months’ imprisonment and $100 special assessment 

after pleading guilty on April 21, 2016, to conspiracy to export items from the United States. Diri will be 

deported once he has completed his sentence. On Oct. 13, 2016, Harold Rinko, a U.S. citizen, was 

sentenced to time served, 2 years supervised release, $100 special assessment and a fine of $2500, after 

pleading guilty on Sept. 16, 2014, to conspiracy to export items from the United States. Rinko is also 

required to wear an electronic monitor for twelve months. Previously, on Nov. 20, 2012, an indictment 

was returned in the Middle District of Pennsylvania charging Diri; Mowea Diri, Ahmad’s brother and a 

citizen of Syria; d-Deri Contracting & Trading, a business located in Syria; and Rinko with criminal 
24

conspiracy, wire fraud, illegal export of goods, money laundering and false statements. On March 14, 

2013, Diri was arrested by the Metropolitan Police in London in connection with the charges in the 

indictment and was extradited to the United States by the United Kingdom on Nov. 12, 2015. Diri was 

arraigned on charges alleging a conspiracy to illegally export laboratory equipment, including items used 

to detect chemical warfare agents, from the United States to Syria. The indictment alleged that from 2003 

until Nov. 20, 2012, the three men conspired to export items from the United States through third party 

countries to customers in Syria without the required U.S. Commerce Department licenses. According to 

the indictment, the conspirators prepared false invoices that undervalued and mislabeled the goods being 

purchased and listed false information regarding the buyers’ identity and geographic location. The 

indictment alleged that the items were to be shipped from the United States to Jordan, the United Arab 

Emirates and the United Kingdom, and thereafter transshipped to Syria. The indictment further states that 

the items allegedly included: a portable gas scanner used for detection of chemical warfare agents by civil 

defense, military, police and border control agencies; a handheld instrument for field detection and 

classification of chemical warfare agents and toxic industrial chemicals; a laboratory source for detection 

of chemical warfare agents and toxic industrial chemicals in research, public safety and industrial 

environments; a rubber mask for civil defense against chemicals and gases; a meter used to measure 

chemicals and their composition; flowmeters for measuring gas streams; a stirrer for mixing and testing 

liquid chemical compounds; industrial engines for use in oil and gas field operations; and a device used to 

accurately locate buried pipelines. Pursuant to regulations of the U.S. Department of Commerce’s Export 

Administration, a license is required to export goods and services from the United States to Syria, 

excepting limited and certain categories of humanitarian food and medicine. This case was investigated 

by ICE-HSI and U.S. Commerce Department’s Office of Export Enforcement. 

Firearm Parts to Republic of Turkey – On Oct. 7, 2016, Hamza Kolsuz, a citizen of the Republic of 

Turkey, was sentenced in the Eastern District of Virginia to 30 months’ imprisonment, 3 years supervised 

release and ordered to pay $200 special assessment. Previously, on June 24, 2016, the Court issued 

Findings of Fact and Conclusions of Law finding Kolsuz guilty of all three counts in the indictment 

pending against him. The Court’s ruling followed a two-day bench trial on May 18-19, 2016. On March

2, 2016, after having previously been charged in a Criminal Complaint, a grand jury in the Eastern 

District of Virginia returned a three-count indictment against Kolsuz, charging him with: (1) conspiring 

to violate the Arms Export Control Act (the “AECA”) and 18 U.S.C. § 554(a), in violation of 18 U.S.C. § 

371; (2) attempting to export defense articles on the United States Munitions List (“USML”) without a 

license or other written authorization from the United States Department of State’s Directorate of Defense 

Trade Controls (the “DDTC”), in violation of the AECA; and (3) attempting to smuggle goods out of the 

United States, in violation of 18 U.S.C. § 554(a). The charges stemmed from Kolsuz’s attempt to export 

firearms parts—specifically, eighteen handgun barrels, twenty-two 9mm handgun magazines, four .45 

caliber handgun magazines, one .357 caliber handgun magazine and one .22 caliber Glock caliber 

conversion kit—to the Republic of Turkey, and his involvement in a years-long conspiracy to export 

firearms parts to the Republic of Turkey. Kolsuz arrived in the United States at Miami International 

Airport on Jan. 25, 2016, on a B-2 visitor’s visa. While in Florida, Kolsuz and one of his co-conspirators 

visited gun stores and a gun show where they purchased firearms parts. On Feb. 2, 2016, Kolsuz began 

his return trip to Istanbul, Republic of Turkey by checking in at Miami International Airport for a flight 

that took him to Cleveland Hopkins International Airport. He then checked in for a flight that was to take 

him and his checked luggage through Cleveland Hopkins International Airport and Washington Dulles 

International Airport before embarking for Istanbul, Republic of Turkey on Turkish Airlines. When 

Kolsuz arrived at Dulles, his luggage was searched and the firearms parts were discovered. The eighteen 

handgun barrels, twenty-two 9mm handgun magazines, four .45 caliber handgun magazines, one .357 

caliber handgun magazine, and one .22 caliber Glock caliber conversion kit were and are each defense 

articles listed on the USML, and a license or other written authorization from the DDTC was and is 

therefore required for the firearms parts to be lawfully exported from the United States. However, Kolsuz 
25

and his co-conspirators have never registered with the DDTC, or applied to register with the DDTC, to 

export defense articles from the United States, and they have never applied for and have never received 

any licenses or other written authorization from the DDTC to export defense articles from the United 

States. This case was investigated by the Department of Homeland Security, Immigration and Customs 

Enforcement, Homeland Security Investigations.

Theft of Trade Secrets of Inbred Corn Seeds to China – On Oct. 5, 2016, in the Southern District of 

Iowa, Mo Hailong, a/k/a Robert Mo, a Chinese national, was sentenced to 36 months in prison for 

conspiracy to steal trade secrets. Mo Hailong was also ordered to serve three years of supervised release 

following his term of imprisonment. On Dec. 19, 2016, Mo Hailong was ordered to pay restitution in the 

amount of $425,000. In addition, the Court ordered the forfeiture of two farms in Iowa and Illinois that 

were purchased and utilized by Mo Hailong and others during the course of the conspiracy. Mo Hailong is 

a Chinese national who became a lawful permanent resident of the United States. During the course of 

the conspiracy, Mo Hailong was employed as the Director of International Business of the Beijing 

Dabeinong Technology Group Company, commonly referred to as DBN. DBN is a Chinese conglomerate 

with a corn seed subsidiary company, Kings Nower Seed. According to the plea agreement entered on 

Jan. 27, 2016, Mo Hailong admitted to participating in a long-term conspiracy to steal trade secrets from 

DuPont Pioneer and Monsanto. Mo Hailong participated in the theft of inbred corn seeds from fields in 

the Southern District of Iowa and elsewhere for the purpose of transporting the seeds to DBN in China. 

The stolen inbred, or parent, seeds were the valuable trade secrets of DuPont Pioneer and Monsanto. The 

investigation was initiated when DuPont Pioneer security staff detected suspicious activity and alerted the 

FBI. DuPont Pioneer and Monsanto were fully cooperative throughout the investigation. This matter was 

investigated by the FBI.

Sanctions Violations to Aid North Korea’s Nuclear Weapons and Ballistic Missile Programs – On Sept. 

26, 2016, a criminal complaint was unsealed in the District of New Jersey charging four Chinese nationals 

and a trading company based in Dandong, China, with conspiring to evade U.S. economic sanctions and 

violating the Weapons of Mass Destruction Proliferators Sanctions Regulations (WMDPSR) through 

front companies by facilitating prohibited U.S. dollar transactions through the United States on behalf of a 

sanctioned entity in the Democratic People’s Republic of Korea (North Korea) and to launder the 

proceeds of that criminal conduct through U.S. financial institutions. On Aug. 3, 2016, a U.S. Magistrate 

Judge in the District of New Jersey signed a criminal complaint charging Ma Xiaohong (Ma) and her 

company, Dandong Hongxiang Industrial Development Co. Ltd. (DHID), and three of DHID’s top 

executives, general manager Zhou Jianshu (Zhou), deputy general manager Hong Jinhua (Hong) and 

financial manager Luo Chuanxu (Luo), with conspiracy to violate the International Emergency Economic 

Powers Act (IEEPA) and to defraud the United States; violating IEEPA; and conspiracy to launder 

monetary instruments. The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) 

also imposed sanctions on DHID, Ma, Zhou, Hong and Luo for their ties to the government of North 

Korea’s weapons of mass destruction proliferation efforts. In addition, the department filed a civil 

forfeiture action for all funds contained in 25 Chinese bank accounts that allegedly belong to DHID and 

its front companies. The department has also requested that the federal court in the District of New Jersey 

issue a restraining order for all of the funds named in the civil forfeiture action, based upon the allegation 

that the funds represent property involved in money laundering, which makes them forfeitable to the 

United States. There are no allegations of wrongdoing by the U.S. correspondent banks or foreign banks 

that maintain these accounts. According to criminal and civil complaints, DHID is primarily owned by 

Ma and is located near the North Korean border. DHID allegedly openly worked with North Korea-based 

Korea Kwangson Banking Corporation (KKBC) prior to Aug. 11, 2009, when the OFAC designated 

KKBC as a Specially Designated National (SDN) for providing U.S. dollar financial services for two 

other North Korean entities, Tanchon Commercial Bank (Tanchon) and Korea Hyoksin Trading 

Corporation (Hyoksin). President Bush identified Tanchon as a weapons of mass destruction proliferator 
26

in June 2005, and OFAC designated Hyoksin as an SDN under the WMDPSR in July 2009. Tanchon and 

Hyoksin were so identified and designated because of their ties to Korea Mining Development Trading 

Company (KOMID), which OFAC has described as North Korea’s premier arms dealer and main 

exporter of goods and equipment related to ballistic missiles and conventional weapons. The United 

Nations (UN) placed KOMID, Tanchon and Hyoksin on the UN Sanctions List in 2006. In March 2016, 

KKBC was added to the UN Sanctions List. In Aug. 2009, Ma allegedly conspired with Zhou, Hong and 

Luo to create or acquire numerous front companies to conduct U.S. dollar transactions designed to evade 

U.S. sanctions. The complaints allege that from Aug. 2009, to Sep. 2015, DHID used these front 

companies, established in offshore jurisdictions such as the British Virgin Islands, the Seychelles and 

Hong Kong, and opened Chinese bank accounts to conduct U.S. dollar financial transactions through the 

U.S. banking system when completing sales to North Korea. These sales transactions were allegedly 

financed or guaranteed by KKBC. These front companies facilitated the financial transactions to hide 

KKBC’s presence from correspondent banks in the United States, according to the allegations in the 

complaints. As a result of the defendants’ alleged scheme, KKBC was able to cause financial transactions 

in U.S. dollars to transit through the U.S. correspondent banks without being detected by the banks and, 

thus, were not blocked under the WMDPSR program. The case was investigated by the FBI.

Systems and Components for Marine Submersible Vehicles to China – On Sept. 26, 2016, in the Middle 

District of Florida, Amin Yu was sentenced to 21 months in federal prison for acting in the U.S. as an 

illegal agent of a foreign government without prior notification to the Attorney General and for conspiring 

to commit international money laundering. According to the plea agreement dated June 10, 2016, from at 

least 2002 until Feb. 2014, at the direction of co-conspirators working for Harbin Engineering University 

(HEU), a state-owned entity in the People’s Republic of China, Yu obtained systems and components for 

marine submersible vehicles from companies in the United States. She then illegally exported those items 

to the PRC for use by her co-conspirators in the development of marine submersible vehicles – unmanned 

underwater vehicles, remotely operated vehicles and autonomous underwater vehicles – for HEU and 

other state-controlled entities. Yu illegally exported items by failing to file electronic export information 

(EEI), as required by U.S. law, and by filing false EEI. In particular, Yu completed and caused the 

completion of export-related documents in which she significantly undervalued the items that she had 

exported and provided false end user information for those items. Previously, on April 21, 2016, an 18-

count superseding indictment was unsealed in the Middle District of Florida charging Yu with acting as 

an illegal agent of a foreign government in the United States without prior notification to the Attorney 

General, conspiring to defraud the United States and to commit offenses against the United States, 

committing unlawful export information activities, smuggling goods from the United States, conspiring to 

and committing international money laundering and making false statements to the U.S. Citizenship and 

Immigration Services. This case was investigated by the FBI, U.S. Immigration and Customs 

Enforcement’s Homeland Security Investigations, the Internal Revenue Service-Criminal Investigation 

and the Naval Criminal Investigative Service. 

Sensitive Technology to Pakistani Military – On Sept. 1, 2016, in the District of Arizona, Syed Vaqar 

Ashraf, of Lahore, Pakistan, was sentenced to 33 months in prison. Ashraf previously pleaded guilty to 

conspiracy to export defense controlled items without a license. Ashraf attempted to procure gyroscopes 

and illegally ship them to Pakistan so they could be used by the Pakistani military. In an effort to evade 

detection, Ashraf arranged for the gyroscopes to be purchased in the name of a shell company and caused 

the gyroscopes to be transshipped to Belgium. Ashraf then traveled to Belgium to inspect the gyroscopes 

and arrange for their final transport to Pakistan. On Aug. 26, 2014, Ashraf was arrested by the Belgium 

Federal Police at the request of U.S. Immigration and Customs Enforcement’s Homeland Security 

Investigations (HSI) agents, who had been conducting an undercover investigation of Ashraf’s activities. 

This case was investigated by ICE-HSI and Belgium Federal Police.
27

Unmanned Aerial Vehicle to China – On Aug. 19, 2016, in the Southern District of Florida, Wenxia 

Man, a/k/a Wency Man, was sentenced to 50 months in prison for conspiring to export and cause the 

export of fighter jet engines, an unmanned aerial vehicle – commonly known as a drone – and related 

technical data to the People’s Republic of China in violation of the Arms Export Control Act. Previously, 

on June 9, 2016, Man was convicted by a federal jury in the Southern District of Florida of one count of 

conspiring to export and cause the export of defense articles without the required license. According to 

evidence presented at trial, between approximately March 2011, and June 2013, Man conspired with 

Xinsheng Zhang, who was located in China, to illegally acquire and export to China defense articles 

including: Pratt & Whitney F135-PW-100 engines used in the F-35 Joint Strike Fighter; Pratt & Whitney 

F119-PW-100 turbofan engines used in the F-22 Raptor fighter jet; General Electric F110-GE-132 

engines designed for the F-16 fighter jet; the General Atomics MQ-9 Reaper/Predator B Unmanned 

Aerial Vehicle, capable of firing Hellfire Missiles; and technical data for each of these defense 

articles. During the course of the investigation, when talking to an undercover HSI agent, Man referred to 

Zhang as a “technology spy” who worked on behalf of the Chinese military to copy items obtained from 

other countries and stated that he was particularly interested in stealth technology. This case was 

investigated by HSI and DCIS.

Defense Articles to Sudan – On Aug. 4, 2016, in the Eastern District of Virginia, Ellias Abdl Halim 

Ghandi, a/k/a’s Eliyas Ghandi, Ellias Woldemariam, and Ellias Ghandi Ahmed, a United States citizen, 

was sentenced to 40 months’ imprisonment, two years’ supervised release and $100 special assessment

following a plea of guilty on May 18, 2016, to violating the Arms Export Control Act. Ghandi pleaded 

guilty to a one-count information alleging that he knowingly and willfully attempted to export and 

exported rifles, pistols, and shotguns, which are defense articles on the U.S. Munitions List, from the 

United States to Khartoum, Sudan, without first obtaining the required license from the State Department. 

According to court documents, from May 6, 2012, to Nov. 20, 2014, Ghandi purchased twenty firearms 

from three firearms dealers on eighteen separate occasions and repeatedly traveled to Khartoum. Ghandi 

admitted that over the years, he had brought 20-30 guns into Sudan where he said that American guns 

were popular and sold well. The investigation was conducted by the U.S. Department of Homeland 

Security, Homeland Security Investigations.

Sensitive Military and Export Controlled Data to China – On July 13, 2016, in the Central District of 

California, Su Bin, also known as Stephen Su and Stephen Subin, a Chinese national and resident of the 

People’s Republic of China, was sentenced to 46 months’ imprisonment, a fine of $10,000 and one year 

of supervised release. Previously, on March 23, 2016, Su Bin pleaded guilty to participating in a yearslong conspiracy to hack into the computer networks of major U.S. defense contractors, steal sensitive 

military and export-controlled data and send the stolen data to China. A criminal complaint filed in 2014 

and subsequent indictments filed in Los Angeles charged Su Bin, a China-based businessman in the 

aviation and aerospace fields, for his role in the criminal conspiracy to steal military technical data, 

including data relating to the C-17 strategic transport aircraft and certain fighter jets produced for the U.S. 

military. Su was initially arrested in Canada in July 2014, on a warrant issued in relation to this case. Su 

ultimately waived extradition and consented to be conveyed to the United States in Feb. 2016. In the plea 

agreement, Su admitted to conspiring with two persons in China from Oct. 2008, to March 2014, to gain 

unauthorized access to protected computer networks in the United States, including computers belonging 

to the Boeing Company in Orange County, California, to obtain sensitive military information and to 

export that information illegally from the United States to China. As part of the conspiracy, Su would email the co-conspirators with guidance regarding what persons, companies and technologies to target 

during their computer intrusions. One of Su’s co-conspirators would then gain access to information 

residing on computers of U.S. companies and email Su directory file listings and folders showing the data 

that the co-conspirator had been able to access. Su then directed his co-conspirator as to which files and 

folders his co-conspirator should steal. Once the co-conspirator stole the data, including by using 
28

techniques to avoid detection when hacking the victim computers, Su translated the contents of certain 

stolen data from English into Chinese. In addition, Su and his co-conspirators each wrote, revised and 

emailed reports about the information and technology they had acquired by their hacking activities, 

including its value, to the final beneficiaries of their hacking activities. Su’s plea agreement makes clear 

that the information he and his co-conspirators intentionally stole included data listed on the U.S. 

Munitions List contained in the International Traffic in Arms Regulations. Su also admitted that he 

engaged in the crime for the purpose of financial gain and specifically sought to profit from selling the 

data the he and his co-conspirators illegally acquired. This case was investigated by the FBI, the U.S. Air 

Force’s Office of Special Investigations, and the Justice Department’s CRM/OIA and NSD/CES.

Satellite Trade Secrets to Undercover Agent – On July 7, 2016, in the Central District of California, 

Gregory Allen Justice was arrested by FBI special agents on federal charges of economic espionage and 

violations of the Arms Export Control Act (AECA) for his attempts to sell sensitive satellite information 

to a person he believed to be a foreign intelligence agent. Justice worked for a cleared defense contractor 

as an engineer on military and commercial satellites during his alleged crimes. According to the affidavit 

in support of the criminal complaint, Justice stole proprietary trade secret materials from his employer and 

provided them to a person whom he believed to be a representative of a foreign intelligence service, but 

who was in fact an FBI undercover agent. In addition to their proprietary nature, the documents contained 

technical data covered by the U.S. Munitions List and therefore controlled for export from the United 

States under the International Traffic in Arms Regulations, according to the allegations. In exchange for 

providing these materials, Justice allegedly sought and received cash payments. On May 22, 2017, 

Gregory Allen Justice pleaded guilty to one count of attempting to commit economic espionage and one 

count of attempting to violate the AECA; on Sep. 19, 2017, he was sentenced to 60 months in prison. This

investigation was conducted by the FBI and AFOSI. 

High Tech U.S. Military Hardware to China – On June 29, 2016, in the District of Delaware, Kan Chen 

of Ningbo, China, in Zhejiang Province, was sentenced to 30 months in prison and three years of 

supervised release for conspiring to violate the Arms Export Control Act and International Traffic in 

Arms Regulations; attempting to violate the Arms Export Control Act and International Traffic in Arms 

Regulations; and violating the International Emergency Economic Powers Act. On June 16, 2015, Chen 

was arrested by HSI agents on the Northern Mariana Island of Saipan following an eight-month long 

investigation into his illegal conduct and has remained in custody. He pleaded guilty to the offenses 

listed above on March 2, 2016. According to court documents, from July 2013, through his arrest in June

2015, Chen caused or attempted to cause the illegal export of over 180 export-controlled items, valued at 

over $275,000, from the United States to China. Over 40 of those items – purchased for more than 

$190,000 – were sophisticated night vision and thermal imaging scopes, which are designated by the 

International Traffic in Arms Regulations as U.S. Munitions List defense articles and can be mounted on 

automatic and semi-automatic rifles and used for military purposes at night. Given the sensitivity 

surrounding these military-grade items, Chen devised a scheme to smuggle these items through Delaware 

and outside the United States. He purchased the devices via the internet and telephone and had them 

mailed to several reshipping services in New Castle, Delaware, which provide an American shipping 

address for customers located in China, accept packages for their customers and then re-shipped them to 

China. In order to further conceal his illegal activity, Chen arranged for the re-shippers to send the 

devices to several intermediary individuals, who in turn forwarded the devices to Chen in China. Chen 

then sent the devices to his customers. During the course of this conduct, Chen made numerous false 

statements in order to knowingly and willfully evade the export control laws of the United States, 

including by undervaluing the shipments, unlawfully avoiding the filing of export information with the 

U.S. government, indicating that he was a natural-born U.S. citizen and providing the address of the 

reshipping service as his own. During the sentencing hearing, the government noted the lethality of these 

items when combined with weapons designed for use on a battlefield. For example, the ATN ThOR 640-
29

5x, 640x480-Inch Thermal Weapon Scope, 100 mm, which Chen purchased for $8,428.39, is described 

by the manufacturer as “an ideal product for force protection, border patrol officers, police SWAT and 

special operations forces providing them the tools they need to be successful in all field operations both 

day and night. Uncooled thermal imaging cuts through dust, smoke, fog, haze, and other battlefield 

obscurants.” These rifle scopes, therefore, are weapons of war, and Chen’s smuggling and subsequent 

sale of these military-grade items outside of the United States directly undermines our nation’s national 

security interests. As the government further noted, Chen’s conduct was particularly harmful because he 

sold this military technology indiscriminately. Thus, it could have ended up in any number of nefarious 

hands – including agents of foreign governments, bad actors and brokers. Once these rifle scopes were 

exported to China and distributed by Chen to his customers, the military technology contained inside 

these items could have been reversed engineered or used anywhere in the world for a variety of purposes 

by oppressive regimes, terrorists, or others to threaten the United States or its allies’ military advantage or 

to commit human rights abuses. This case was investigated by HSI and U.S. Department of CommerceBureau of Industry and Security’s Office of Export Enforcement. 

High-Tech Material Used in Missile Production and Nuclear Applications to Iran – On June 14, 2016, 

in the Eastern District of New York, Erdal Kuyumcu, the CEO of Global Metallurgy LLC, a company 

based in Woodside, New York, pleaded guilty to one count of conspiring to violate the International 

Emergency Economic Powers Act, in connection with the export of specialty metals from the United 

States to Iran. On Sep. 7, 2017, Kuyumcu was sentenced to 57 months in prison and fined $7,000. As 

detailed in the criminal information to which he pleaded guilty and other court filings, Kuyumcu, a U.S. 

citizen, conspired to export from the United States to Iran a metallic powder composed of cobalt and 

nickel, without having obtained the required license from the U.S. Treasury Department’s Office of 

Foreign Assets Control (OFAC). The metallic powder can be used to coat gas turbine components, 

including turbine blades, and can be used in aerospace, missile production and nuclear applications. Such 

specialized metals are closely regulated by the U.S. Department of Commerce to combat nuclear 

proliferation and protect national security, and exporting them without an OFAC license is illegal. 

Kuyumcu and others conspired to obtain over 1,000 pounds of the metallic powder from a U.S.-based 

supplier for export to Iran. To hide the true destination of the goods from the U.S. supplier, Kuyumcu 

and a co-conspirator arranged for the metallic powder to be shipped first to Turkey and then to Iran. This 

case was investigated by the Commerce Department and the FBI.

Theft of Valuable Source Code for China – On June 14, 2016, Jiaqiang Xu was charged in the Southern 

District of New York in a six-count superseding indictment with economic espionage and theft of trade 

secrets, in connection with Xu’s theft of proprietary source code from his former employer, with the 

intent to benefit the National Health and Family Planning Commission of the People’s Republic of China. 

On May 19, 2017, Xu pleaded guilty to the indictment, and is to be sentenced in January 2018. Xu was 

initially arrested by the FBI on Dec. 7, 2015, and subsequently charged on Jan. 6, 2016, by indictment 

with one count of theft of trade secrets. According to court documents, from Nov. 2010, to May 2014, Xu 

worked as a developer for a particular U.S. company (the “Victim Company”). As a developer, Xu 

enjoyed access to certain proprietary software (the “Proprietary Software”), as well as that software’s 

underlying source code (the “Proprietary Source Code”). The Proprietary Software is a clustered file 

system developed and marketed by the Victim Company in the U.S. and other countries. A clustered file 

system facilitates faster computer performance by coordinating work among multiple servers. The Victim 

Company takes significant precautions to protect the Proprietary Source Code as a trade secret. The 

Victim Company takes these precautions in part because the Proprietary Software and the Proprietary 

Source Code are economically valuable, which value depends in part on the Proprietary Source Code’s 

secrecy. In May 2014, Xu voluntarily resigned from the Victim Company. Xu subsequently, in a series 

of communication with UC agents, uploaded Victim Company’s Proprietary Source Code to the UC’s 

computer network. On Dec. 7, 2015, Xu met with UC-2 at a hotel in White Plains, New York (the Hotel). 
30

Xu stated, in sum and substance, that Xu had used the Proprietary Source Code to make software to sell to 

customers, that Xu knew the Proprietary Source Code to be the product of decades of work on the part of 

the Victim Company, and that Xu had used the Proprietary Source Code to build a copy of the Proprietary 

Software, which Xu had uploaded and installed on the UC Network (i.e., the Xu Upload). Xu also 

indicated that Xu knew the copy of the Proprietary Software that Xu had installed on the UC Network 

contained information identifying the Proprietary Software as the Victim Company’s property, which 

could reveal the fact that the Proprietary Software had been built with the Proprietary Source Code 

without the Victim Company’s authorization. Xu told UC-2 that Xu could take steps to prevent detection 

of the Proprietary Software’s origins – i.e., that it had been built with stolen Proprietary Source Code –

including writing computer scripts that would modify the Proprietary Source Code to conceal its origins. 

Later on Dec. 7, 2015, Xu met with UC-1 and UC-2 at the Hotel. During that meeting, Xu showed UC-2 a 

copy of what Xu represented to be the Proprietary Source Code on Xu’s laptop. Xu noted to UC-2 a 

portion of the code that indicated it originated with the Victim Company as well as the date on which it 

had been copyrighted. Xu also stated that Xu had previously modified the Proprietary Source Code’s 

command interface to conceal the fact that the Proprietary Source Code originated with the Victim 

Company and identified multiple specific customers to whom Xu had previously provided the Proprietary 

Software using Xu’s stolen copy of the Proprietary Source Code. This case was investigated by the FBI.

Tactical Equipment to Insurgent Groups in Syria – On June 10, 2016, in the Eastern District of Virginia, 

Amin al-Baroudi, a Syrian-born naturalized U.S. citizen, formerly of Irvine, California, was sentenced to 

32 months in prison for conspiring to export U.S.-origin goods from the United States to Syria, in 

violation of sanctions imposed on Syria by the U.S. government. Baroudi pleaded guilty on Jan. 15, 

2016, to conspiracy to export U.S. goods to Syria, in violation of the International Emergency Economic 

Powers Act, 50 U.S.C. §§ 1702 and 1705(a) and (c). According to court documents, Baroudi admitted 

that from at least Dec. 2011, through March 2013, he and his co-conspirators exported U.S. tactical 

equipment to Syria for the purpose of supplying and arming Ahrar al-Sham and other insurgent groups in 

Syria whose stated goal is to overthrow the Assad government and install an Islamic state. Ahrar al-Sham 

frequently fights alongside Jabhat al-Nusrah, which has been designated by the U.S. State Department as 

a foreign terrorist organization and operates as al-Qaeda’s official branch in Syria. According to court 

documents, Baroudi and his co-conspirators purchased tens of thousands of dollars-worth of goods from 

companies and vendors in the United States, consisting largely of tactical equipment such as sniper rifle 

scopes, night vision rifle scopes, night vision goggles, laser bore sighters, speed loaders and bullet proof 

vests. Baroudi and his co-conspirators traveled with the goods aboard commercial flights to Turkey and 

then transported the goods into Syria or provided them to others for transport. Baroudi made two such 

trips in Feb. and March of 2013. This case was investigated by the FBI, DOC OEE, ICE HSI, California 

Highway Patrol; the Irvine Police Department; the Orange County, California, Sheriff’s Department; and 

the Regional Computer Forensics Laboratory in Orange County provided significant assistance.

High-Grade Carbon Fiber to China – On June 9, 2016, Fuyi Sun, a/k/a “Frank”, a citizen of the People’s 

Republic of China, was charged in a one-count indictment in the Southern District of New York with 

attempting to violate the International Emergency Economic Powers Act (“IEEPA”). On April 21, 2017, 

Sun pleaded guilty; and on Sep. 6, 2017, he was sentenced to 36 months in prison. On April 13, 2016, 

Sun was arrested in connection with a scheme to illegally export to China, without a license, high-grade 

carbon fiber that is used primarily in aerospace and military applications. Sun was arrested after traveling 

to New York to meet with undercover agents (UCs) in an effort to obtain the specialized fiber, which –

due to its military and aerospace applications – requires an export license for export to China. Sun was 

originally charged April 13, 2016, in a three-count Complaint, with: Count One – attempt to violate the 

International Emergency Economic Powers Act (“IEEPA”); Count Two – conspiracy to violate IEEPA; 

and Count Three – attempt to smuggle goods from the United States. According to Court documents, Sun 

attempted for years to acquire high-grade carbon fiber for illegal export to China. After traveling to New 
31

York from China to finalize the deal, Sun allegedly told the UCs that the carbon fiber he sought was 

headed to the Chinese military. He then paid tens of thousands of dollars in cash to purchase two cases of 

it. To avoid law enforcement detection, Sun allegedly directed the UCs to ship the carbon fiber in 

unmarked boxes and to falsify the shipping documents regarding the contents of the boxes. Courts 

documents also state that, since approximately 2011, Sun has attempted to acquire extremely high-grade 

carbon fiber, including Toray type M60JB-3000-50B carbon fiber (“M60 Carbon Fiber”). M60 Carbon 

Fiber has applications in aerospace technologies, unmanned aerial vehicles (commonly known as 

“drones”) and other government defense applications. Accordingly, M60 Carbon Fiber is strictly 

controlled – including that it requires a license for export to China – for nuclear non-proliferation and 

anti-terrorism reasons. In furtherance of his attempts to illegally export M60 Carbon Fiber from the 

United States to China without a license, Sun contacted what he believed was a distributor of carbon fiber 

– but which was, in fact, an undercover entity created by HSI and “staffed” by HSI UCs. Sun inquired 

about purchasing the M60 Carbon Fiber without the required license. In the course of his years-long 

communications with the UCs and the UC Company, Sun repeatedly suggested various security measures 

that he believed would protect them from “U.S. intelligence.” Among other such measures, at one point, 

Sun instructed the UCs to use the term “banana” instead of “carbon fiber” in their 

communications. Consequently, soon thereafter he inquired about purchasing 450 kilograms of “banana” 

for more than $62,000. In order to avoid detection, Sun also suggested removing the identifying barcodes 

for the M60 Carbon Fiber, prior to transshipment, and further suggested that they identify the M60 

Carbon Fiber as “acrylic fiber” in customs documents. On or about April 11, 2016, Sun traveled from 

China to New York for the purpose of purchasing M60 Carbon Fiber from the UC Company. During 

meetings with the UCs, on or about April 11 and 12, 2016, among other things, Sun repeatedly suggested 

that the Chinese military was the ultimate end-user for the M60 Carbon Fiber he sought to acquire from 

the UC Company. Sun claimed to have personally worked in the Chinese missile program. Sun also 

asserted that he maintained a close relationship with the Chinese military, had a sophisticated 

understanding of the Chinese military’s need for carbon fiber, and suggested that he would be supplying 

the M60 Carbon Fiber to the Chinese military or to institutions closely associated with it. On or about 

April 12, 2016, Sun agreed to purchase two cases of M60 Carbon Fiber from the UC Company. Sun paid 

the UCs $23,000 in cash for the carbon fiber. He also paid an additional $2,000 to the UCs as 

compensation for the risk he believed they were taking to illegally export the carbon fiber to China 

without a license. This investigation was conducted by DOC, HSI, and DCIS.

High-Tech Electronic Components to Iran – On May 23, 2016, in the Southern District of New York, 

Ali Reza Parsa, a Canadian-Iranian dual citizen and resident of Canada, was sentenced to three years in 

prison for his participation in a conspiracy to violate the International Emergency Economic Powers Act 

(IEEPA) and the Iranian Transactions and Sanctions Regulations (ITSR). Parsa was arrested in Oct.

2014, following an investigation by the FBI and U.S. Department of Commerce’s Bureau of Industry and 

Security (BIS). He pleaded guilty on Jan. 20, 2016. According to court documents, between 

approximately 2009 and 2015, Parsa conspired to obtain high-tech electronic components from American 

companies for transshipment to Iran and other countries for clients of Parsa’s procurement company in 

Iran, Tavan Payesh Mad, in violation of U.S. economic sanctions. To accomplish this, Parsa used his 

Canadian company, Metal PM, to place orders with U.S. suppliers and typically had the parts shipped to 

him in Canada or to a freight forwarder located in the United Arab Emirates, and then shipped from these 

locations to Iran or to the location of his Iranian company’s client. Parsa provided the U.S. companies 

with false destination and end-user information about the components in order to conceal the illegality of 

these transactions. Parsa’s criminal scheme targeted numerous American technology companies. The 

components that Parsa attempted to procure included cryogenic accelerometers, which are sensitive 

components that measure acceleration at very low temperatures. Cryogenic accelerators have both 

commercial and military uses, including in applications related to ballistic missile propellants and in 

aerospace components such as liquid-fuel rocket engines. In addition, following his arrest and while 
32

incarcerated, Parsa continued to violate the IEEPA and the ITSR by conducting business for Metal PM 

and Tavan Payesh Mad, including by ordering parts from German and Brazilian companies for Iranian 

customers. Parsa subsequently directed a relative to delete email evidence of his ongoing business 

transactions while in jail and emphasized the need for secrecy in their dealings. Neither Parsa nor any 

other individual or entity involved in transactions that gave rise to his conviction applied for or obtained a 

license from the U.S. Department of the Treasury’s Office of Foreign Assets Control for the transactions. 

This case was investigated by the FBI and Department of Commerce BIS.

Defense Materials to India – On April 14, 2016, in the District of New Jersey, Hannah Robert, the owner 

of two New Jersey defense contracting businesses, was sentenced to 57 months in prison for conspiring to 

send sensitive military technical data to India. Previously, on April 1, 2015, Robert pleaded guilty to one 

count of conspiracy to violate the Arms Export Control Act (22 U.S.C. § 2778). On Oct. 28, 2013, 

Robert was arraigned for allegedly transmitting military technical drawings to India without first 

obtaining a license from the U.S. Department of State, in violation of U.S. export laws. She was indicted 

by a federal grand jury on Oct. 10, 2013, on one count of violating the Arms Export Control Act and one 

count of conspiracy to violate the act. According to the documents filed in this case and statements made 

in court, Robert was the founder, owner, and President of One Source USA LLC, a company located at 

her then-residence in Mount Laurel, N.J., and contracted with the U.S. Department of Defense (DoD) to 

supply defense hardware items and spare parts pursuant to government contracts. In Sep. 2012, Robert 

opened a second defense-contracting company, Caldwell Components Inc., based at the same address in 

Mount Laurel. Along with "R.P," a resident of India, Robert owned and operated a company in India, One 

Source (One Source India), that manufactured defense hardware items and spare parts in India. From June

2010 to Dec. 2012, Robert and R.P. conspired to export to India defense technical drawings without 

obtaining the necessary licenses from the U.S. Department of State. The exported technical drawings 

include parts used in the torpedo systems for nuclear submarines, in military attack helicopters, and in F15 fighter aircraft. Robert allegedly lied on her bids for DoD contracts, stating that she would be 

supplying American-made products and that her N.J.-based company was a manufacturer, rather than a 

dealer, of defense spare parts. One Source USA also subcontracted to other American defense contractors, 

including those in Sussex County, N.J., and Boca Raton, Fla. Robert provided export-controlled items 

made in India to these defense contractors in the United States in such a way as to appear to the DoD that 

the items were manufactured in this country. In addition to United States' sales, Robert and R.P. sold 

defense hardware items to foreign customers. Robert transmitted export-controlled technical data to R.P. 

in India so that Robert and R.P. could submit bids to foreign actors, including those in the United Arab 

Emirates (UAE), to supply them or their foreign customers with defense hardware items and spare parts. 

Neither Robert nor R.P. obtained approval from the U.S. Department of State for this conduct. On Aug. 

23, 2012, R.P. e-mailed Robert from India requesting the technical drawing for a particular military item. 

R.P.'s e-mail forwarded Robert an e-mail from an individual purporting to be "an official contractor of the 

UAE Ministry of Defence," and who listed a business address in Abu Dhabi, UAE. The UAE e-mail 

requested quotations for a bid for the "blanket assembly" for the CH-47F Chinook military helicopter and 

listed the "End User" for the hardware item as the UAE Armed Forces. Later that same day, Robert 

replied to R.P.'s e-mail, attaching, among other things, the electronic file for an export-controlled 

technical drawing titled "Installation and Assy Acoustic Blankets, STA 120 CH-47F," to be used in the 

Chinook attack helicopter. Starting in Oct. 2010, Robert transmitted the military drawings for these parts 

to India by posting the technical data to the password-protected website of a Camden County, N.J., church 

where she was a volunteer web administrator. This was done without the knowledge of the church staff. 

Robert e-mailed R.P. the username and password to the church website so that R.P. could download the 

files from India. Through the course of the scheme, Robert uploaded thousands of technical drawings to 

the church website for R.P. to download in India. On June 25, 2012, R.P. e-mailed Robert from India, 

stating in part: "Please send me the church web site username and password." The e-mail was in reference 

to both an invoice to, and a quote for, an individual known to Robert as a broker of defense hardware 
33

items for an end-user in Pakistan. This individual (the "Pakistan trans-shipper") employed a UAE address 

for shipping purposes. This case was investigated by DoD, DCIS, and DHS HSI Counter Proliferation 

Investigations.

F-14 Fighter Jet Parts to Iran – On April 5, 2016, in the Northern District of Georgia, Oguzhan Aydin 

was sentenced to 30 months’ imprisonment, 5 years supervised release, $200 special assessment and a 

$25,000 fine. Aydin pleaded guilty on Oct. 13, 2015, to exporting munitions out of the United States and 

money laundering. Previously, on Aug. 26, 2014, Aydin was arrested pursuant to an arrest warrant in the 

Northern District of Georgia. A federal grand jury returned an indictment charging Aydin, Saeid 

Kamyari, AGM Ltd. Co. and Blue Sky Aviation with violations of the Arms Export Control Act and the 

International Emergency Economic Powers Act. According to court documents, between Sep. 2009, and 

Aug. 2010, Kamyari, while in Iran, worked through AGM Ltd. Co., a company located in Tehran, Iran, to 

procure aircraft parts for the F-14 Fighter Jet and other aircraft parts for shipment from the U.S. to Iran. 

Aydin, while in the Republic of Turkey, assisted Kamyari through his association with Blue Sky Aviation 

a/k/a BSA Hava Kargo Ltd. Sti. Using e-mails, Kamyari and Aydin coordinated and arranged through 

AGM LTD Co. and Blue Sky Aviation, the purchase and export of microcircuits designed for use on F-14 

fighter jets and other aircraft parts for shipment from the U.S. through Turkey to Iran. At no time did the 

co-conspirators obtain a license to export aircraft parts from the U.S. to Iran. This investigation was 

conducted by DHS.

Sanctions Violations to Aid the Government of Iran – On March 21, 2016, an indictment was unsealed 

in the Southern District of New York against Reza Zarrab, a/k/a Riza Sarraf, a resident of Turkey and 

dual citizen of Turkey and Iran; Camelia Jamshidy, a/k/a Kamelia Jamshidy, a citizen of Iran; and 

Hossein Najafzadeh, a citizen of Iran, for engaging in hundreds of millions of dollars-worth of 

transactions on behalf of the government of Iran and other Iranian entities, which were barred by U.S. 

sanctions, laundering the proceeds of those illegal transactions and defrauding several financial 

institutions by concealing the true nature of these transactions. Zarrab was arrested on March 19, 2016, 

and had his initial court appearance in Miami, Florida, on March 21, 2016. Jamshidy and Najafzadeh 

remain at large. According to the allegations contained in the indictment, between 2010 and 2015, 

Zarrab, Jamshidy and Najafzadeh conspired to conduct international financial transactions on behalf of 

and for the benefit of, among others, Iranian businesses, the Iranian government and entities owned or 

controlled by the Iranian government. Among the beneficiaries of these schemes were: Bank Mellat, an 

Iranian government-owned bank designated, during the time of the charged offenses, by the U.S. 

Department of the Treasury’s Office of Foreign Assets Control (OFAC) as a Specially Designated 

National (SDN) under the Iranian Transactions and Sanctions Regulations, the Iranian Financial 

Sanctions Regulations and the Weapons of Mass Destruction Proliferators Sanctions Regulations; Mellat 

Exchange, an Iranian money services business owned and controlled by Bank Mellat; the National Iranian 

Oil Company (NIOC), identified during the time of the charged offenses by OFAC as an agent or affiliate 

of Iran’s Islamic Revolutionary Guard Corp (IRGC); the Naftiran Intertrade Company Ltd. (NICO), 

Naftiran Intertrade Company Sarl (NICO Sarl) and Hong Kong Intertrade Company (KHICO), companies 

located in the United Kingdom, Switzerland and Hong Kong, respectively, that were acting on behalf of 

NIOC; and the MAPNA Group, an Iranian construction and power plant company. Bank Mellat, NIOC, 

NICO Sarl, NICO and HKICO are no longer designated as SDNs and NIOC is no longer identified as an 

agent or affiliate of the IRGC, though these entities remain “blocked parties,” with whom U.S. persons 

continue to be prohibited generally from engaging in unlicensed transactions or dealings. The scheme 

was part of an intentional effort to assist the government of Iran in evading the effects of United States 

and international economic sanctions. Zarrab, Jamshidy, Najafzadeh and their co-conspirators used an 

international network of companies located in Iran, Turkey and elsewhere to conceal from U.S. banks, 

OFAC and others that the transactions were on behalf of and for the benefit of Iranian entities. This 

network of companies includes Royal Holding A.S., a holding company in Turkey; Durak Doviz 
34

Exchange, a money services business in Turkey; Al Nafees Exchange, a money services business; Royal 

Emerald Investments; Asi Kiymetli Madenler Turizm Otom, a company located in Turkey; ECB 

Kuyumculuk Ic Vedis Sanayi Ticaret Limited Sirketi, a company located in Turkey; and Gunes General 

Trading LLC; and others. As a result of this scheme, the co-conspirators induced U.S. banks to 

unknowingly process international financial transactions in violation of the IEEPA. On Oct. 26, 2017, 

Reza Zarrab pleaded guilty. The case was investigated by the FBI.

Technology Equipment to China – On March 2, 2016, Louis Brothers was sentenced in the Eastern

District of Kentucky to 93 months in prison for illegally exporting sophisticated technology equipment to 

the People’s Republic of China (PRC) and concealing the unlawful proceeds. The sentence also includes 

a monetary judgment of $1.1 million. Brothers, a former president and CEO of Valley Forge Composite 

Technologies, pleaded guilty to the offenses in July 2015. He admitted that from 2009 until 2013, he 

unlawfully exported microcircuits to the PRC. Under federal law, anyone exporting a defense article, 

including microcircuits, to the PRC must obtain the permission of the Department of State for the 

purposes of maintaining national security. According to his plea agreement, Brothers intentionally 

avoided notifying the Department of State about his activity and labeled his shipments as “computer 

parts” in order to conceal the true identity of the items. Brothers further admitted that he falsified 

paperwork to make it appear that the proceeds he received from his business with the PRC were actually 

profits from a business he owned in Kentucky. The investigation was conducted by the FBI and ICE 

HSI.

Night Vision Devices to China – On Feb. 29, 2016, Song Il Kim, a/k/a Kim Song Il was sentenced in the 

District of Utah to 40 months’ imprisonment, 36 months supervised release and $100 special assessment 

after pleading guilty on Dec. 9, 2015, to violating the Arms Export Control Act. Kim attempted to export 

from the United States to China night vision devices without first obtaining a license from the State 

Department.

Pressure Transducers to Iran – On Jan. 27, 2016, Sihai Cheng, a citizen of the People’s Republic of 

China (PRC), was sentenced in the District of Massachusetts to nine years imprisonment and $600 special 

assessment after pleading guilty on Dec. 18, 2015, to two counts of conspiring to commit export 

violations and smuggle goods from the U.S. to Iran and four counts of illegally exporting U.S. 

manufactured pressure transducers to Iran. In Feb. 2014, Cheng was arrested by the British authorities on 

U.S. charges during a trip to the United Kingdom. He was detained in the United Kingdom pending 

extradition to the United States. Cheng arrived in Boston from the United Kingdom on Dec. 5, 2014. On 

April 4, 2014, following an international investigation, Cheng and co-defendant Seyed Abolfazl Shahab 

Jamili, an Iranian national, were indicted along with two Iranian companies, Nicaro Eng. Co. and Eyvaz 

Technic Manufacturing Co., for conspiring to export American-made pressure transducers to Iran. 

Pressure transducers can be used in gas centrifuges to enrich uranium and produce weapons-grade 

uranium. The indictment alleged that between Nov. 2005 and 2012, Cheng supplied thousands of parts 

that have nuclear applications, including U.S.-origin goods, to Eyvaz, an Iranian company involved in the 

development and procurement of parts for Iran's nuclear weapons program. In 2011, the Council of the 

European Union designated Eyvaz as an entity "involved in [Iran's] nuclear or ballistic missile activities" 

and imposed restrictive measures against it. In so doing, it found that Eyvaz had produced vacuum 

equipment, which it supplied to two of Iran's uranium nuclear enrichment facilities, Natanz and Fordow, 

and that it also had supplied pressure transducers to Kalaye Electric Company, an Iranian company which 

has been designated by the U.S. and United Nations as a proliferator of Weapons of Mass Destruction. 

Specifically, the indictment alleged that in 2005, Cheng began doing business with Jamili, who worked 

for Eyvaz and ran his own importing business in Iran. Beginning in Feb. 2009, Cheng and Jamili 

conspired with others in the PRC to illegally obtain hundreds of U.S. manufactured pressure transducers 

manufactured by MKS Instruments, Inc., headquartered in Massachusetts, on behalf of Eyvaz. As a result 
35

of the illegal activities of Cheng and his co-conspirators, hundreds of MKS pressure transducers were 

illegally exported from the U.S. to China. Upon receipt of these parts in China, Cheng caused the MKS 

pressure transducers to be exported to Eyvaz or Jamili in Tehran, Iran, in violation of U.S. export laws. 

The indictment further alleged that by 2007, Iran was operating thousands of gas centrifuges at the Natanz 

uranium enrichment facility. Iran has sought and illicitly obtained MKS pressure transducers to use in its 

centrifuge plants. Publicly available photographs of Natanz (with then President Mahmoud Ahmadinejad) 

show numerous MKS pressure transducers attached to Iran's gas centrifuge cascades. Because pressure 

transducers can be used in gas centrifuges to convert natural uranium into a form that can be used in 

nuclear weapons, they are subject to export controls and cannot be shipped to China without an export 

license or to Iran at all. On Jan. 16, 2016, the indictment was dismissed against Jamili. This case was 

investigated by the FBI, U.S. Immigration and Customs Enforcement's (ICE) Homeland Security 

Investigations (HSI) and the Department of Commerce's Office of Export Enforcement.

Military Aircraft Components to UAE, Thailand – On Jan. 15, 2016, John Nakkashian was sentenced in 

the Central District of California to 2 years’ probation, $100 special assessment, and a fine of $1,000 after 

previously pleading guilty on Aug. 28, 2014, to a 1st Superseding Information. Nakkashian admitted that 

he knowingly made a false statement on a Shipper’s Export Declaration Form that a military gyroscope 

being shipped to Thailand did not require an export license, when in fact it did. Nakkashian was a Vice 

President for International Sales at Air Shunt Instruments, Inc. Air Shunt, a Chatsworth, California 

company that buys and sells aircraft and aerospace components, was charged via criminal information 

and pleaded guilty in the Central District of California on July 15, 2008. The company was sentenced on 

July 17, 2008, and ordered to pay a criminal fine of $250,000 and a special assessment of $400 for 

making false statements on a Shipper's Export Declaration in claiming that a military gyroscope being 

sent overseas in 2003 did not require an export license, when in fact the item required such a license. 

Nakkashian was responsible for obtaining the required licenses for such exports. On May 20, 2008, 

Nakkashian was indicted on four counts of violating the Arms Export Control Act. The indictment 

alleged that Nakkashian illegally exported components for the J85 engine used on the F-5 fighter jet, and

other military items to Dubai, United Arab Emirates, without first obtaining the required export license 

from the State Department. The indictment also alleged that Nakkashian illegally exported a military 

gyroscope to Thailand. Nakkashian was arrested on June 16, 2014, after fleeing the country during the 

investigation. The investigation was conducted by DCIS and ICE. 

Military Technical Drawings Downloaded/Exported Outside of the U.S. – On Dec. 8, 2015, in the 

District of New Jersey, Alper Calik of Ankara, Turkey and the former owner of two New Jersey defense 

contracting businesses was sentenced to time served, Special Assessment of $100, and Restitution in the 

amount of $347,240, after pleading guilty on Aug. 27, 2015, to a one-count Information charging him 

with committing mail fraud. Previously, on Sep. 13, 2014, Calik was arrested upon his entry into the 

United States. Calik was charged by complaint with two counts of mail fraud in connection with 

allegedly fraudulent contracts entered into with the U.S. Department of Defense (DoD), and one count of 

violating the Arms Export Control Act, in connection with his download of thousands of military 

technical drawings while outside the United States without prior approval from the U.S. Department of 

State. According to the complaint, starting in Nov. 2009, Calik was the co-owner of Clifmax LLC in 

Clifton, New Jersey. The company contracted with DoD to supply defense hardware items and spare 

parts. Starting in May 2011, Calik started a second defense-contracting company, Tunamann LLC, based 

at the same address in Clifton. Both Clifmax and Tunamann were allegedly “shell” companies for 

manufacturing facilities in Turkey, created to obtain DoD contracts that the manufacturers were not 

permitted to receive. Calik, on numerous occasions, falsely claimed to the DoD that Clifmax and 

Tunamann were U.S.-based manufacturers, when, in fact, neither company ever had any manufacturing 

capabilities in the United States. Calik is charged with violating the Arms Export Control Act. For both 

Clifmax and Tunamann, Calik submitted Military Critical Technical Data Agreements in which he 
36

claimed his companies were U.S.-based manufacturers. Calik also acknowledged that he understood 

export control laws and agreed not to disseminate export-controlled data and technical drawings in a 

manner that would violate export control laws. Based on his false representations, Calik was granted 

electronic access to drawings and technical data subject to U.S. export control regulations. Beginning in 

2009, Calik downloaded approximately one hundred thousand drawings, some of which were subject to 

U.S. export control regulations. Calik was not in the United States when the majority of the drawings 

were downloaded and he did not obtain export licenses from the U.S. Department of State. On May 23, 

2013, Calik, who at that time was operating Tunamann, downloaded from a DoD database the technical 

drawings for parts that go into the NSSN Class Submarine. Those drawings contained warnings stating 

that the export of the drawings to places outside the United States is restricted by the Arms Export 

Control Act. Calik was not in the United States when those drawings were downloaded and he did not 

obtain an export license from the U.S. Department of State for the export of those drawings. This case 

was investigated by the Department of Defense, Defense Criminal Investigative Service and HSI, Counter 

Proliferation Investigations.

Sniper Rifles to Belarus – On Dec. 2, 2015, in the District of Utah, a federal grand jury returned an 

indictment charging Kolar Rahman Anees Ur Rahman, age 44, who was born in India and lives in the 

United Arab Emirates, with violations of federal law in connection with alleged efforts to purchase 89 

Sako .308 caliber sniper rifles and have them exported from the United States to Belarus. The charges in 

the four-count indictment include conspiracy to commit an offense against the United States, a violation 

of the Arms Export Control Act, smuggling goods from the United States, and money 

laundering. Rahman was arrested in early Nov. 2016, in Chicago on a complaint filed in 

Utah. Following a removal proceeding in Chicago, he was transferred to Salt Lake City by the U.S. 

Marshals Service. According to the indictment, it is the policy of the United States to deny licenses and 

other approvals for the export of defense articles and defense services destined for Belarus, as well as 

other countries subject to an arms embargo. According to the indictment, in Nov. 2013, a firearms 

manufacturer in Salt Lake City was contacted through email by someone identified as Individual A in the 

indictment regarding the purchase of 50 sniper rifles to be shipped to Belarus. The firearms manufacturer 

notified Individual A that the purchase and delivery would be impossible due to current trade sanctions 

and embargoes against Belarus. The firearms manufacturer subsequently informed a special agent with 

U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) about the 

suspicious inquiry. An HSI Salt Lake City undercover agent contacted Individual A by email. In those 

communications, Individual A reiterated his desire to procure sniper rifles in the United States for 

delivery to Belarus. From Nov. 2013, through May 2015, negotiations between the undercover agent and 

Individual A did not result in a purchase. However, in May 2015, Individual A introduced the undercover 

agent to Rahman, designating Rahman as the principal broker for the procurement of the sniper rifles. 

The indictment alleged that from May 2015, until Nov. 2015, the defendant engaged in a conspiracy to 

purchase 89 sniper rifles in the United States and have them exported to Belarus without first obtaining 

licenses as required. In Aug. 2015, Rahman and an undercover agent agreed that Rahman would make a 

first purchase of 10 sniper rifles and ammunition for approximately $66,285. No party to the transaction 

obtained export licenses for the rifles. In Sep. 2015, according to the indictment, Rahman informed the 

undercover agent that the final contract with Belarus had been completed and sent the undercover agent a 

down payment of approximately $13,257 for 10 sniper rifles. Rahman agreed to pay the remaining 

balance once the rifles arrived in Belarus. He told the undercover agent not to include U.S. invoices with 

the shipment. Rahman requested that the sniper rifles be shipped by the most direct route possible to 

Belarus. According to the indictment, the undercover agent informed Rahman that the shipment route 

would be from the United States to South Africa, to Turkey and then to Belarus. On Nov. 4, 2015, two 

undercover HSI agents met with an individual who identified himself as Kolar Rahman Anees Ur 

Rahman at a hotel near Chicago, according to the indictment. Rahman confirmed he was the same 

individual the agents had been negotiating with since May. Rahman, the indictment alleged, informed the 
37

agents that he understood the risk of illegally obtaining and shipping the sniper rifles to Belarus and that 

he desired to complete their business transaction as planned. Rahman and the agents discussed future 

purchases and shipments of the .308 caliber rifles to Belarus. Rahman was arrested by the agents in 

Chicago later that day. On Jan. 30, 2017, Rahman pleaded guilty; he was sentenced to 60 months’ 

probation and forfeiture of $13,000. 

Theft of Military Trade Secrets to Iran – On Oct. 27, 2015, Mozaffar Khazaee, also known as “Arash 

Khazaie”, was sentenced in the District of Connecticut to 97 months’ imprisonment, 3 years supervised 

release, $100 special assessment and $50,000 fine. Previously, on Feb. 25, 2015, Khazaee pleaded guilty 

to a one-count information charging him with unlawful export and attempted export of defense articles 

from the United States, in violation of the Arms Export Control Act. On Jan. 21, 2014, a federal grand 

jury returned an indictment charging Khazaee with two counts of interstate transportation of stolen 

property. The indictment stems from Khazaee’s alleged attempt to ship to Iran proprietary material 

relating to military jet engines and the U.S. Air Force’s F35 Joint Strike Fighter program that he had 

illegally retained from defense contractors where he had been employed. As alleged in court documents, 

federal law enforcement agents began investigating Khazaee in Nov. 2013, when officers with U.S. 

Customs and Border Protection Service (CBP), assisted by Homeland Security Investigations (HSI) 

special agents, inspected a shipment that Khazaee sent by truck from Connecticut to a freight forwarder 

located in Long Beach, California, which was intended for shipment from the U.S. to Iran. The 

documentation for Khazaee’s shipment indicated that it contained household goods. Upon inspecting the 

shipment, however, CBP officers and HSI agents discovered that the content of the shipment primarily 

contained numerous boxes of documents consisting of sensitive technical manuals, specification sheets, 

and other proprietary material relating to the U.S. Air Force’s F35 Joint Strike Fighter program and 

military jet engines. Upon further investigation, law enforcement learned that Khazaee holds Iranian and 

U.S. citizenship and, as recently as Aug. 2013, worked as an engineer for defense contractors, including 

firms that are the actual owners of the technical and proprietary documents and materials in Khazaee’s 

shipment. Khazaee, who became a naturalized U.S. citizen in 1991, holds a valid U.S. passport. On Jan.

9, 2014, Khazaee was arrested by HSI and FBI agents at Newark Liberty International Airport in New 

Jersey after flying from Indianapolis to Newark, before he was able to board a connecting flight to 

Frankfurt, Germany. Khazaee’s ticketed destination was Tehran, Iran. This case was investigated by HSI, 

CBP, the U.S. Air Force’s Office of Special Investigations, DCIS, and the FBI.

Schematics of Navy’s Nuclear Aircraft Carrier to Egypt – On Oct. 15, 2015, Navy Engineer Mostafa 

Ahmed Awwad was sentenced in the Eastern District of Virginia to 11 years of incarceration after having 

earlier plead guilty to attempted espionage. Awwad was originally arrested on Dec. 5, 2014, on charges 

of attempting to steal schematics of the Navy’s newest nuclear aircraft carrier, the USS Gerald R. Ford, 

and pass the schematics to whom he believed was an Egyptian government official. Awwad was indicted 

on Dec. 3, 2014, and charged with two counts of attempted exportation of defense articles and technical 

data. According to court documents, Awwad began working for the Department of the Navy in Feb. 

2014, as a civilian general engineer in the Nuclear Engineering and Planning Department at Norfolk 

Naval Shipyard. Based on a joint investigation, an FBI undercover agent speaking in Arabic contacted 

Awwad by telephone on Sep. 18, 2014, and asked to meet him the following day. Without seeking 

additional information from the caller, Awwad agreed. The next day Awwad met with the undercover FBI 

agent, who was posing as an Egyptian intelligence officer, in a park in Hampton, VA. During the meeting, 

Awwad claimed it was his intention to utilize his position of trust with the U.S. Navy to obtain military 

technology for use by the Egyptian government, including but not limited to, the designs of the USS 

Gerald R. Ford nuclear aircraft carrier. Awwad agreed to conduct clandestine communications with the 

undercover FBI agent by email and unattributable telephones and to conduct “dead drops” in a concealed 

location in the park. On Oct. 9, 2014, Awwad and the undercover FBI agent met at a hotel where Awwad 

described a detailed plan to circumvent U.S. Navy computer security by installing software on his 
38

restricted computer system that would enable him to copy documents without causing a security alert. At 

this time Awwad also provided the undercover FBI agent four Computer Aided Drawings of a U.S. 

nuclear aircraft carrier downloaded from the Navy Nuclear Propulsion Information system. These 

drawings were marked with warnings that foreign distribution could result in criminal prosecution. 

During the discussion, Awwad indicated his understanding that the drawings would be sent to and used in 

Egypt. Awwad also asked the undercover FBI agent for $1,500 to purchase a pinhole camera he would 

wear around the shipyard to photograph restricted material. At the conclusion of the meeting, Awwad 

agreed to provide the undercover FBI agent with passport photos which would be used to produce a 

fraudulent Egyptian passport so Awwad could travel to Egypt without alerting U.S. government officials. 

On Oct. 23, 2014, Awwad traveled to the pre-arranged dead drop site situated on a secluded hiking trail, 

and utilized a concealed container disguised in a hole in the ground. He retrieved $3,000 in cash before 

placing a one terabyte external hard drive and two passport photos inside. The FBI later collected the 

contents of the dead drop container. On Nov. 28, 2014, Awwad was observed entering his office at the 

Norfolk Naval Shipyard holding a cardboard tube about three feet long. Once in his office, Awwad 

opened the cardboard tube and took out several white sheets which appeared to be design schematics of 

an aircraft carrier. Awwad then placed the schematics on the floor of his office and photographed them. 

After approximately 45 minutes of viewing the schematics and taking photographs, Awwad placed all the 

schematics back in the cardboard tube and left his office. Awwad plead guilty to the espionage charge on 

June 15, 2015. This case was investigated by the FBI’s Norfolk Field Office and the Naval Criminal 

Investigative Service, in cooperation with the Department of Navy.

Gyroscope to Iran – On Aug. 27, 2015, Ali Mohammadi, a United States citizen, was sentenced in the 

Northern District of Illinois to 5 years’ probation, a $2,000 fine and $100 special assessment. Previously, 

on Feb. 26, 2015, Mohammadi pleaded guilty to conspiracy to violate the International Emergency 

Economic Powers Act (IEEPA) and the U.S. sanctions against Iran. Mohammadi was the sole owner and 

operator of Modir Trading, an export business. According to court documents, Mohammadi, Modir 

Trading, and Ebrahim Hallaji, an Iranian national, conspired to export one Series 446 Rate Integrating 

Gyroscope, a component of the TOW missile, from the United States to Iran. Hallaji contacted 

Mohammadi by email in Feb. 2010, requesting that Mohammadi obtain certain gyroscope models to sell 

and export to Iran for Hallaji, who claimed to conduct import and export business in the United Arab 

Emirates. Hallaji informed Mohammadi that the items were prohibited to be sold directly to Iran. 

Mohammadi contacted a salesperson for gyroscopes and was told that he would need an export license to 

export the gyroscope internationally. The salesperson was an undercover agent. Mohammadi falsely 

informed the agent that the gyroscopes would be used as models in California. Mohammadi, Modir 

Trading, and Hallaji were indicted on July 31, 2012. Hallaji remains a fugitive.

Sensitive U.S. Technology to Iran – On Aug. 27, 2015, Arash Ghahreman, a naturalized U.S. citizen and 

former Iranian national, was sentenced in the Southern District of California to 78 months’ imprisonment, 

3 years supervised release, and $100 special assessment. Previously, on April 23, 2015, a federal jury 

convicted Ghahreman of violations of U.S. export and money laundering laws, arising from his 

involvement in a scheme to purchase marine navigation equipment and military electronic equipment for 

illegal export to, and end-use in, Iran. Ghahreman was convicted of attempted export to Iran, and 

conspiracy to do the same, in violation of the Iran Transactions and Sanctions Regulations; smuggling 

goods from the U.S., and conspiracy to do the same; and aiding and abetting the transfer of money from 

Dubai, United Arab Emirates (UAE), to the U.S., in support of an illegal export activity, and conspiracy 

to do the same. After a seven-day jury trial, the jury returned a guilty verdict on seven counts of a ninecount superseding indictment after only one day of deliberation. The jury was unable to reach a verdict 

on two of the counts involving the attempted exportation and smuggling of a fiber optic gyrocompass, 

used in both military and civilian marine navigation applications. The evidence presented at trial showed 

that Ghahreman acted as an agent of an Iranian procurement network which used a front company in 
39

Dubai to acquire U.S. goods and technologies for illegal transshipment to, and end-use in, Iran. Codefendant Koorush Taherkhani, an Iranian national and resident, was the managing director and founder 

of that front company, co-defendant TIG Marine Engineering Services. Because of his German 

nationality, co-defendant Ergun Yildiz, 35, a resident of UAE, was hired by Taherkhani to be the “face” 

of the front company, as the president/CEO of TIG Marine. Before Ghahreman immigrated to the U.S. in 

2007, Ghahreman and Taherkhani had been friends and dorm mates at an Iranian university, where each 

received a degree in marine engineering. Upon graduation, both Ghahreman and Taherkhani worked as 

engineers for various Iranian shipping companies, including the Islamic Republic of Iran Shipping Lines 

and its subsidiaries. After immigrating to the U.S., Ghahreman was employed by various shipyards in the 

U.S., and became a naturalized U.S. citizen. Because of his employment and citizenship status, 

Ghahreman was well placed to act as an agent of the illegal procurement network. From Dec. 2012,

through June 17, 2013, Ghahreman and his co-defendants negotiated via email, text, telephone and 

meetings with U.S. Immigration Customs and Enforcement’s Homeland Security Investigations (ICEHSI) and the Defense Criminal Investigative Service (DCIS) undercover agents to purchase marine 

navigation components (fiber optic gyrocompasses), military electronic components (electron tubes) and 

other U.S. technology for illegal export to, and/or end-use in, Iran. The undercover agents were posing as 

brokers of U.S. goods and technology, willing to sell U.S. goods to the defendants for end-use in 

Iran. Ultimately, as a result of these negotiations, Ghahreman and his co-defendants agreed to purchase 

four Navigat-2100 fiber optic gyrocompasses and 50 Y-690 units (electron tubes). Pursuant to that 

agreement, Ghahreman and his co-defendants wired approximately $60,000 in partial payment for the 

gyrocompasses and electron tubes from a bank in Dubai to the undercover agents’ bank 

account. Ultimately, on June 17, 2013, ICE-HSI agents arrested Ghahreman and Yildiz after they 

traveled to the U.S. and took partial delivery of one gyrocompass and two electron tubes and attempted to 

ship the items indirectly to Iran, via third countries. On Oct. 9, 2014, Yildiz pleaded guilty to conspiracy 

to export to Iran. He was sentenced on May 8, 2015, to time served, 2 years supervised release, and $100 

special assessment. On Jan. 21, 2016, the Court dismissed with prejudice the superseding indictment 

against Taherkhani and Tig Marine Engineering Services. This case was investigated by ICE-HSI and 

DCIS. 

Accelerometers to China – On Aug. 25, 2015, Yue Wu, a/k/a David Wu, a Chinese national, was 

sentenced in the Western District of Washington to 18 months’ imprisonment, $100 special assessment, 

and deportation after completion of his sentence following a plea of guilty on May 26, 2015, to 

conspiracy to violate the Arms Export Control Act. Previously, on Oct. 22, 2014, Wu was indicted for 

violating the Arms Export Control Act. According to court documents, between Dec. 2011, and Oct.

2014, Wu directed others to contact a United States manufacturer and request the purchase of QA3000 

accelerometers for export to China without first obtaining a license from the United States Department of 

State. Wu and another person met with an undercover agent in San Francisco, CA, in an effort to order 

30 accelerometers from the undercover agent. Wu explained that he was attempting to acquire the 

accelerometers on behalf of a customer in China. He requested that the accelerometers be concealed in 

housing to evade United States export restrictions, providing the agent with schematics for the 

construction of the housing. Court documents further show that Wu suggested that the agent ship the 

accelerometers to Wu’s associate in Switzerland, who, in turn, would transship the accelerometers into 

China. 

Firearms Parts and Accessories to Lebanon – On Aug. 12, 2015, in the District of Maryland, Sam Rafic 

Ghanem was sentenced to 18 months in prison followed by three years of supervised release for 

attempting to illegally export firearms parts and accessories to Lebanon, and for smuggling goods from 

the United States. Ghanem was ordered by the Court to pay a fine of $70,734.24. Ghanem, a naturalized 

U.S. citizen born in Lebanon, owned and operated Washington Movers International, also known as 

Washington Movers, Inc., a freight forwarding business located in District Heights, Maryland. According 
40

to evidence presented at his five-day trial, beginning Oct. 3, 2013, Ghanem sought to export guns and 

accessories to Lebanon through his shipping company that were provided to him by an FBI 

source. Ghanem knew that the weapons and accessories were designated as defense articles and required 

an export license, which Ghanem never sought or obtained. In addition, those items were prohibited from 

export to Lebanon. Specifically, Ghanem attempted to export seven 9mm semi-automatic pistols; three 

.40 caliber semi-automatic pistols; 10 AR-15 .223 caliber semi-automatic rifles; and 18 advanced combat 

optic gun sights. According to trial evidence, on Nov. 21, 2013, Ghanem told the source to pay him 

$3,000 for the cost of purchasing salvaged vehicles which would be used to export the firearms and 

accessories. Ghanem texted the source his bank account number and at the direction of law enforcement, 

the source deposited $3,000 into Ghanem’s account. Ghanem purchased the salvaged vehicles and 

arranged for them to be cut up. Ghanem concealed the weapons and other items within the doors and cutup parts of the salvaged vehicles, which were then loaded into a shipping container. Ghanem advised the 

source that the shipping container would be loaded with the remaining car parts and transported to the 

Port of Baltimore for shipment to Lebanon on Dec. 23, 2013. Ghanem was subsequently arrested. This 

investigation was conducted by the FBI and ICE HSI.

Thermal Imaging Camera to Pakistan – On June 30, 2015, in the Northern District of Illinois, Bilal 

Ahmed was sentenced to 24 months’ imprisonment, $100 special assessment, $1,000 fine, and 2 years 

supervised release after previously pleading guilty on Oct. 2, 2014, to count one of a superseding 

indictment charging him with violating export control regulations. Previously, on May 7, 2014, a federal 

indictment was returned charging Ahmed with one count of violating the International Emergency 

Economic Powers Act (IEEPA) and one count of attempted smuggling of goods, in violation of U.S. 

export regulations. The indictment alleged that Ahmed violated U.S. export laws by attempting to ship a 

FLIR HRC-U thermal imaging camera from his company in Schaumburg, IL, to a company in Pakistan 

without first obtaining a license from the U.S. Commerce Department. The FLIR HRC-U thermal 

imaging camera is on the Commerce Control List and is controlled for reasons of national security and 

regional stability. Ahmed was initially charged in a criminal complaint and arrested on March 14, 2014. 

According to the complaint affidavit and the indictment, Ahmed was the owner, president, and registered 

agent of Trexim Corp., which used the address of a virtual office in Schaumburg. Between Nov. 2013,

and Feb. 2014, Ahmed corresponded via email with a company in California and negotiated the purchase 

of a FLIR HRC-U thermal imaging camera for approximately $102,000, which he paid with two checks 

in Feb. 2014. Ahmed took delivery of the camera on Feb. 27, 2014, at a commercial shipping store in 

Bolingbrook, IL. On March 7, 2014, Ahmed allegedly took the camera, packaged in two boxes, to a 

different commercial shipper located in Elk Grove Village and left the packages to be shipped to a 

company in Pakistan. The waybill included a handwritten note containing the letters “NLR,” meaning “no 

license required.” A search of U.S. State and Commerce Department databases showed there were no 

licenses applied for or obtained by Ahmed, Trexim or any other related individual or company names for 

the export of a FLIR HRC-U thermal imaging camera from the U.S. to Pakistan. This case was 

investigated by the Federal Bureau of Investigation and the U.S. Department of Commerce, Bureau of 

Industry and Security, Office of Export Enforcement.

Theft of Trade Secrets by Chinese Professors for Technology to China - On May 16, 2015, Tianjin 

University Professor Hao Zhang was arrested upon entry into the U.S. from the People’s Republic of 

China (PRC) in connection with a recent superseding indictment in the Northern District of California. 

The 32-count indictment, which had previously been sealed, charges a total of six individuals with 

economic espionage and theft of trade secrets for their roles in a long-running effort to obtain U.S. trade 

secrets for the benefit of universities and companies controlled by the PRC government. According to the 

indictment, PRC nationals Wei Pang and Hao Zhang met at a U.S. university in Southern California 

during their doctoral studies in electrical engineering. While there, Pang and Zhang conducted research 

and development on thin-film bulk acoustic resonator (FBAR) technology under funding from U.S. 
41

Defense Advanced Research Projects Agency (DARPA). After earning their doctorate in approximately 

2005, Pang accepted employment as an FBAR engineer with Avago Technologies (Avago) in Colorado 

and Zhang accepted employment as an FBAR engineer with Skyworks Solutions Inc. (Skyworks) in 

Massachusetts. The stolen trade secrets alleged in the indictment belong to Avago or Skyworks. Avago 

is a designer, developer and global supplier of FBAR technology, which is a specific type of radio 

frequency (RF) filter. Throughout Zhang’s employment, Skyworks was also a designer and developer of 

FBAR technology. FBAR technology is primarily used in mobile devices like cellular telephones, tablets 

and GPS devices. FBAR technology filters incoming and outgoing wireless signals so that a user only 

receives and transmits the specific communications intended by the user. Apart from consumer 

applications, FBAR technology has numerous applications for a variety of military and defense 

communications technologies. According to the indictment, in 2006 and 2007, Pang, Zhang and other coconspirators prepared a business plan and began soliciting PRC universities and others, seeking 

opportunities to start manufacturing FBAR technology in China. Through efforts outlined in the 

superseding indictment, Pang, Zhang and others established relationships with officials from Tianjin 

University. Tianjin University is a leading PRC Ministry of Education University located in the PRC and 

one of the oldest universities in China. As set forth in the indictment, in 2008, officials from Tianjin 

University flew to San Jose, CA, to meet with Pang, Zhang and other co-conspirators. Shortly thereafter, 

Tianjin University agreed to support Pang, Zhang and others in establishing an FBAR fabrication facility 

in the PRC. Pang and Zhang continued to work for Avago and Skyworks in close coordination with 

Tianjin University. In mid-2009, both Pang and Zhang simultaneously resigned from the U.S. companies 

and accepted positions as full professors at Tianjin University. Tianjin University later formed a joint 

venture with Pang, Zhang and others under the company name ROFS Microsystem intending to mass 

produce FBARs. The indictment alleged that Pang, Zhang and other co-conspirators stole recipes, source 

code, specifications, presentations, design layouts and other documents marked as confidential and 

proprietary from the victim companies and shared the information with one another and with individuals 

working for Tianjin University. According to the indictment, the stolen trade secrets enabled Tianjin 

University to construct and equip a state-of-the-art FBAR fabrication facility, to open ROFS 

Microsystems, a joint venture located in PRC state-sponsored Tianjin Economic Development Area 

(TEDA), and to obtain contracts for providing FBARs to commercial and military entities. The 

remaining indicted defendants are all citizens of the PRC and include: Jinping Chen, a professor at 

Tianjin University and a member of the board of directors for ROFS Microsystems; Huisui Zhang 

(Huisui) studied with Pang and Zhang at a U.S. university in Southern California and received a Master’s 

Degree in Electrical Engineering in 2006; Chong Zhou, a Tianjin University graduate student and a 

design engineer at ROFS Microsystem. Zhou studied under Pang and Zhang; Zhao Gang, the General 

Manager of ROFS Microsystems. A trial is expected in 2018. This investigation was conducted by the 

FBI.

Illegal Trade with Iran and Sudan – On May 6, 2015, in the District of Columbia, Schlumberger Oilfield 

Holdings Ltd. (SOHL), a wholly-owned subsidiary of Schlumberger Ltd., entered into a formal judgment 

memorializing the sentence requiring SOHL to pay a $232,708,356 penalty to the U.S. for conspiring to 

violate the International Emergency Economic Powers Act (IEEPA) by willfully facilitating illegal 

transactions and engaging in trade with Iran and Sudan. At a hearing on April 30, 2015, the Court 

accepted the company’s guilty plea and sentenced the company to the proposed sentence articulated in the 

plea agreement, which called for the fine and other terms of corporate probation. The court recognized 

the seriousness of SOHL’s criminal conduct, which posed a threat to our national security. In addition, 

the court noted that the scope of criminal conduct justified the large monetary penalty imposed. Finally, 

the court concluded that the terms of probation provided adequate deterrence to SOHL as well as other 

companies. The Court entered the written judgment confirming the sentence imposed on April 30, 2015. 

Previously, on March 25, 2015, a criminal information was filed in the District of Columbia charging 

SOHL with one count of knowingly and willfully conspiring to violate IEEPA. SOHL waived the 
42

requirement of being charged by way of federal Indictment, agreed to the filing of the information, and 

accepted responsibility for its criminal conduct and that of its employees by entering into a plea

agreement with the government. The plea agreement requires that SOHL pay the U.S. government 

$232,708,356 and enter into a three-year period of corporate probation. SOHL’s monetary penalty 

includes a $77,569,452 criminal forfeiture and an additional $155,138,904 criminal fine. The criminal 

fine represents the largest criminal fine in connection with an IEEPA prosecution. In addition to SOHL’s 

agreement to continue its cooperation with U.S. authorities throughout the three-year period of probation 

and not to engage in any felony violation of U.S. federal law, SOHL’s parent company, Schlumberger 

Ltd., also has agreed to continue its cooperation with U.S. authorities during the three-year period of 

probation, and hire an independent consultant who will review the parent company’s internal sanctions 

policies, procedures and company-generated sanctions audit reports. According to court documents, 

starting in or about early 2004 and continuing through June 2010, Drilling & Measurements (D&M), a 

United States-based Schlumberger business segment, provided oilfield services to Schlumberger 

customers in Iran and Sudan through non-U.S. subsidiaries of SOHL. Although SOHL, as a subsidiary of 

Schlumberger Ltd., had policies and procedures designed to ensure that D&M did not violate U.S. 

sanctions, SOHL failed to train its employees adequately to ensure that all U.S. persons, including nonU.S. citizens who resided in the United States while employed at D&M, complied with Schlumberger 

Ltd.’s sanctions policies and compliance procedures. As a result of D&M’s lack of adherence to U.S. 

sanctions combined with SOHL’s failure to train properly U.S. persons and to enforce fully its policies 

and procedures, D&M, through the acts of employees residing in the United States, violated U.S. 

sanctions against Iran and Sudan by: (1) approving and disguising the company’s capital expenditure 

requests from Iran and Sudan for the manufacture of new oilfield drilling tools and for the spending of 

money for certain company purchases; (2) making and implementing business decisions specifically 

concerning Iran and Sudan; and (3) providing certain technical services and expertise in order to 

troubleshoot mechanical failures and to sustain expensive drilling tools and related equipment in Iran and 

Sudan. In 2009, in consultation with the U.S. Department of State, Schlumberger agreed to no longer 

pursue new oilfield contracts in Iran. In 2011, Schlumberger voluntarily decided to cease providing 

oilfield services in Iran and the Republic of the Sudan (North Sudan). As of June 30, 2013, Schlumberger 

ceased providing oilfield services in Iran. And presently, Schlumberger has ceased providing oilfield 

services in North Sudan as well. This case was investigated by the Department of Commerce – BIS.

Trade Secrets to South Korea - On May 1, 2015, Kolon Industries, Inc., a South Korean industrial 

company, was sentenced in the Eastern District of Virginia to 5 years’ probation and was ordered to pay 

$400 special assessment, $85,000,000 in criminal fines and $275,000,000 in restitution. Kolon Industries,

Inc., appearing through two successor entities—Kolon Industries, Inc. and Kolon Corporation 

(collectively, Kolon)—pleaded guilty in federal court on April 30, 2015, to one count of conspiracy to 

convert trade secrets involving E.I. DuPont de Nemours & Co.’s (DuPont) Kevlar technology. According 

to the statement of facts filed with the plea agreement, from June 2006, to Feb. 2009, Kolon conspired 

with former DuPont employees and others to steal DuPont’s trade secrets for making Kevlar, a highstrength, para-aramid synthetic fiber. Kevlar, a trademarked name, is one of DuPont's most well-known 

products and is used in a wide range of commercial applications such as body armor, fiber optic cables, 

and automotive and industrial products. Kolon admitted that it was attempting to improve the quality of 

its own para-aramid fiber known as Heracron. Kolon personnel met repeatedly with former DuPont 

employees, including Edward Schulz of Brownstown, PA, and Michael Mitchell, of Chesterfield, VA, to 

obtain confidential and proprietary DuPont information about Kevlar. Schulz pleaded guilty to 

conspiracy to steal trade secrets in Sep. 2014, and was sentenced in July 2015, to 2 years’ probation, 500 

hours’ community service, $100 special assessment and a $75,000 fine. Mitchell pleaded guilty to theft 

of trade secrets and obstruction of justice in Dec. 2009, and was sentenced to 18 months in prison, 3 years 

supervised release, $200 special assessment, and $187,895.90 in restitution. Kolon admitted that it 

obtained technical and business documents regarding Kevlar, including instructional materials that 
43

described DuPont’s “New Fiber Technology,” documents on polymerization, and a detailed breakdown of 

DuPont’s capabilities and costs for the full line of its Kevlar products and DuPont’s Kevlar customers. 

According to the statement of facts and Mitchell’s admissions at his guilty plea, Mitchell exchanged 

numerous telephone calls and emails with Kolon personnel. On more than one occasion, Mitchell advised 

Kolon personnel that some of the information they sought was proprietary and that DuPont considered 

such information to be trade secrets. Mitchell also coordinated a meeting at a hotel in Richmond, at 

which Kolon personnel were introduced to a cooperating witness who pretended to be a disgruntled 

scientist from DuPont. During the Richmond meeting, Kolon personnel indicated that they would only be 

comfortable communicating with the cooperating witness in a manner that was confidential and that 

would not leave an evidentiary trail. In Feb. 2009, DuPont filed a civil lawsuit against Kolon in the 

Eastern District of Virginia, alleging theft of trade secrets. Thereafter, certain Kolon personnel attempted 

to delete files and emails related to Mitchell, Schulz and outside consultants hired to improve Kolon’s 

para-aramid fiber, and urged other Kolon personnel to search for such materials and mark them for 

deletion. Kolon also admitted that certain employees approached a former employee of an American 

subsidiary of Teijin Ltd. – a Japanese company that makes the para-aramid fiber called Twaron—in an 

unsuccessful effort to obtain information about Twaron. This case represents the first time that foreign 

corporations with no direct presence in the United States were found to be successfully served with U.S. 

criminal process, over their objections, based on service pursuant to an international treaty. In Dec. 2014, 

the district court found that both of the successor companies were properly served, and ordered them to 

appear for arraignment. In Feb. 2015, the Fourth Circuit Court of Appeals denied Kolon’s petition for 

extraordinary relief seeking reversal of the district court’s order. Five former Kolon executives and 

employees, all of South Korea, were charged in an Aug. 2012, indictment filed in the Eastern District of 

Virginia: Jong-Hyun Choi, a senior executive who oversaw the Heracron Business Team; In-Sik Han, 

who managed Kolon’s research and development related to Heracron; Kyeong-Hwan Rho, the head of the 

Heracron Technical Team; Young-Soo Seo, the general manager for the Heracron Business Team; and 

Ju-Wan Kim, a manager on the Heracron Business Team. The case was investigated by the FBI’s 

Richmond Division.

Fighter Jet Parts to Thailand and Pakistan - On April 27, 2015, Russell Marshall and his company, 

Universal Industries Limited, Inc., were sentenced in the Southern District of Florida for violating the 

International Emergency Economic Powers Act. Marshall was sentenced to serve 41 months in prison 

and will be removed from the United States upon the completion of his sentence. In imposing the 

sentence, the Court found that the order denying export privileges issued by the Department of Commerce 

constituted a national security control, which subjected Marshall to an enhanced sentence. Marshall and 

his company, Universal Industries Limited Inc., were previously convicted in a 2011 case in the Southern 

District of Florida for violating the Arms Export Control Act, after which the Department of Commerce 

issued a denial order prohibiting Universal Industries Limited Inc. and its owners, agents and employees 

from participating in any transaction involving the export of any item subject to the Department of 

Commerce‘s Export Administration Regulations (EAR). Marshall and Universal Industries Limited Inc. 

violated IEEPA and the U.S. Department of Commerce’s denial order by attempting to send three 

temperature transmitters used on F-16 fighter jets and a saddle part for the J-69 engine used on 737 

military trainer aircraft to Thailand and Pakistan, respectively. According to court documents and 

information presented during the sentencing hearing, the DoD Inspector General received a hotline 

complaint concerning Marshall and Universal Industries Limited Inc. in Nov. 2012. The subsequent 

investigation revealed that the defendants brokered the sale of military aircraft parts which were subject to 

license controls by the Department of Commerce, and which the defendants knew were intended to be 

illegally exported to Thailand and Pakistan. On Feb. 6, 2015, Marshall and Universal Industries Limited 

Inc. entered guilty pleas to an information that charged them with knowingly and willfully engaging in 

negotiations concerning selling, delivering or otherwise servicing a transaction involving an item to be 

exported from the United States to Thailand and subject to the EAR. Universal Industries Limited Inc. 
44

was sentenced to a term of one year of probation and a special assessment of $400 upon a finding that the 

corporation is currently listed as inactive by the Florida Division of Corporations as a result of Marshall’s 

arrest. This case was investigated by DoD, DCIS, ICE-HSI and the U.S. Department of Commerce’s 

Office of Export Enforcement.

Proliferation Materials to North Korea –On April 24, 2015, Yueh-Hsun Tsai, a/k/a “Gary Tsai”, was 

sentenced in the Northern District of Illinois to 3 years of probation and a fine of $250. On March 16, 

2015, Hsien Tai Tsai, a/k/a “Alex Tsai”, was sentenced to 2 years’ imprisonment and $100 special 

assessment. Previously, on Oct. 10, 2014, Alex Tsai pleaded guilty to conspiracy to defraud the United 

States in its enforcement of regulations targeting proliferators of weapons of mass destruction. In his plea 

agreement, Alex Tsai admitted that he engaged in illegal business transactions involving the export of 

U.S. origin goods and machinery. On Dec. 16, 2014, his son, Gary Tsai, pleaded guilty to a superseding 

information charging him with making a false bill of lading. In his plea agreement, Gary Tsai admitted to 

arranging the export of a grinder to Taiwan by falsely identifying the consignee of the shipment. On June

6, 2013, Alex Tsai, who the U.S. government has linked to the supply of weapons machinery to North 

Korea, and Gary Tsai, were indicted in the Northern District of Illinois for allegedly conspiring to violate 

U.S. laws designed to thwart the proliferation of weapons of mass destruction. On May 1, 2013, both 

Alex Tsai and Gary Tsai were arrested pursuant to criminal complaints filed on April 19, 2013. Alex 

Tsai, who was believed to have resided in Taiwan, was arrested in Tallinn, Estonia, and later extradited to 

the United States. Gary Tsai, who is from Taiwan and is a U.S. legal permanent resident, was arrested at 

his home in Illinois. Each were charged with conspiring to defraud the United States in its enforcement 

of laws prohibiting the proliferation of weapons of mass destruction; conspiracy to violate the 

International Emergency Economic Powers Act (IEEPA) by conspiring to evade the restrictions imposed 

on Alex Tsai and two of his companies by the U.S. Treasury Department, and money laundering. Agents 

had been investigating the pair, as well as Individual A (a Taiwanese associate of Alex Tsai), and a 

network of companies engaged in the export of U.S. origin goods and machinery that could be used to 

produce weapons of mass destruction. The investigation revealed that Alex and Gary Tsai and Individual 

A were associated with at least three companies based in Taiwan - Global Interface Company, Inc., Trans 

Merits Co., Ltd., and Trans Multi Mechanics Co., Ltd. - that purchased and then exported, and attempted 

to purchase and then export, from the United States machinery used to fabricate metals and other 

materials with a high degree of precision. On Jan. 16, 2009, the Treasury Department designated Alex 

Tsai, Global Interface, and Trans Merits as proliferators of weapons of mass destruction, isolating them 

from the U.S. financial system and prohibiting any U.S. person or company from doing business with 

them. In announcing the order, the Treasury Department said that Alex Tsai was designated for providing 

support for, or goods or services in support of the Korea Mining Development Trading Corporation 

(KOMID), which was designated as a proliferator by the U.S. in 2005. The Treasury Department asserted 

that Alex Tsai "has been supplying goods with weapons production capabilities to KOMID and its 

subordinates since the late 1990s, and he has been involved in shipping items to North Korea that could 

be used to support North Korea's advanced weapons program." After the OFAC designations, Alex and 

Gary Tsai and another individual allegedly continued to conduct business together but attempted to hide 

Alex Tsai's and Trans Merit's involvement in those transactions by conducting business under different 

company names, including Trans Multi Mechanics. This investigation was conducted by the FBI, ICEHSI and BIS. 

Military Sensors Manufactured for Department of Defense Exported to China – On April 23, 2015, Bo 

Cai, a Chinese national, was sentenced in the District of New Mexico to 24 months’ imprisonment. On 

the same day, his cousin Wentong Cai, a Chinese national in the U.S. on a student Visa, was also 

sentenced to 18 months’ imprisonment. Both men are scheduled to be deported after completing their 

prison sentences. Bo Cai and Wentong Cai were charged in a three-count superseding indictment with a 

scheme to illegally export sensors primarily manufactured for sale to the U.S. Department of Defense for 
45

use in high-level applications such as line-of-sight stabilization and precision motion control systems, 

without first obtaining the required export license. Previously, on Dec. 16, 2014, Wentong Cai, pleaded 

guilty to conspiring with Bo Cai to violate the Arms Export Control Act and the International Traffic 

Arms Regulations (ITAR). Bo Cai pleaded guilty on July 23, 2014. Cai and Wentong Cai participated in 

a scheme to illegally export defense articles with military applications to the People’s Republic of China. 

According to court documents, in March 2012, Bo Cai, was employed by a technology company in 

China. He embarked on an illegal scheme to smuggle sensors out of the U.S. to China for one of his 

customers despite knowledge that the sensors could not be exported without a license and that the U.S. 

did not issue licenses to export the sensors to China. Bo Cai enlisted his cousin Wentong Cai to acquire 

the sensors under the ruse that he planned to use the sensors at Iowa State University where he was a 

graduate microbiology student. The investigation of this case began in Oct. 2013, when an undercover 

HSI agent responded to Wentong Cai’s overtures. After negotiations by telephone and email, Bo Cai and 

Wentong Cai traveled to New Mexico in Dec. 2013, where they obtained a sensor from undercover HSI 

agents and developed a plan for smuggling the sensor out of the U.S. to China. On Dec. 11, 2013, Bo Cai 

was arrested at an airport in Los Angeles, CA, after the sensor was discovered concealed in a computer 

speaker in his luggage. Bo Cai was preparing to board a flight to China. Wentong Cai was arrested in 

Iowa in Jan. 2014. This investigation was conducted by Homeland Security Investigations, USAF Office 

of Special Investigations, Defense Security Service, FBI.

High-Tech Microelectronics and Uninterruptible Power Supplies to Iran – On April 17, 2015, in the 

Southern District of Texas, a 24-count indictment was unsealed charging four corporations and five 

individuals with facilitating the illegal export of high-tech microelectronics, uninterruptible power 

supplies and other commodities to Iran, in violation of the International Emergency Economic Powers 

Act (IEEPA). The indictment alleged that Houston-based company Smart Power Systems Inc. (SPS),

Bahram Mechanic and Tooraj Faridi – both of Houston – and Khosrow Afghahi of Los Angeles, were all 

members of an Iranian procurement network operating in the United States. Also charged as part of the 

scheme were Arthur Shyu and the Hosoda Taiwan Limited Corporation in Taiwan, Matin Sadeghi and 

Golsad Istanbul Trading Ltd. in Turkey, and the Faratel Corporation co-owned by Mechanic and Afghahi 

in Iran. The indictment was returned under seal on April 16, 2015, and unsealed as Mechanic and Faridi 

made their initial appearances. Afghahi was taken into custody and made an initial appearance in the 

Central District of California. Sadeghi and Shyu are believed to be out of the country. Warrants remain 

outstanding for their arrests. In conjunction with the unsealing of these charges, the Department of 

Commerce designated seven foreign nationals and companies, adding them to its Entity List. Designation 

on the Entity List imposes a license requirement before any commodities can be exported from the United 

States to these persons or companies and establishes a presumption that no such license will be granted. 

According to the indictment, Mechanic and Afghahi are the co-owners of Iran-based Faratel and its 

Houston-based sister company SPS. Faratel, currently the vice president of SPS, designs and builds 

uninterruptible power supplies for various Iranian entities, including Iranian government agencies such as 

the Iranian Ministry of Defense, the Atomic Energy Organization of Iran, and the Iranian Centrifuge 

Technology Company. Shyu is a senior manager at the Hosoda Taiwan Limited Corporation, a trading 

company located in Taiwan, while Sadeghi is an employee of Golsad Istanbul Trading, a shipping 

company located in Turkey. The indictment alleged that between approximately July 2010, and the 

present, Mechanic and the others engaged in a conspiracy to obtain various commodities, including 

controlled United States-origin microelectronics. They then allegedly exported these commodities to Iran, 

while carefully evading the government licensing system set up to control such exports. The 

microelectronics shipped to Iran allegedly included microcontrollers and digital signal processors. These 

commodities have various applications and are frequently used in a wide range of military systems, 

including surface-air and cruise missiles. Mechanic’s network allegedly sent at least $24 million worth of 

commodities to Iran. Mechanic, assisted by Afghahi and Faridi, regularly received lists of commodities, 

including United States-origin microelectronics sought by Faratel in Iran, and would approve these orders 
46

and then send the orders to Shyu in Taiwan. Shyu would allegedly purchase the commodities utilizing 

Hosoda Taiwan Limited and then ship the commodities to Turkey, where Sadeghi would act as a false 

buyer via his company, Golsad Istanbul Trading Ltd. The indictment further alleged that Sadeghi would 

receive the commodities from Shyu and then ship them to Faratel in Iran. Mechanic required his coconspirators to notify him and obtain his approval for each of the transactions completed by the network. 

Mechanic, Afghahi and Shyu are also charged with conspiring to commit money laundering and 

substantive money laundering violations. Mechanic further faces a charge of willful failure to file foreign 

bank and financial accounts. Arthur Shyu remains a fugitive. In January 2016, as part of an agreement 

between the U.S. Government and the Government of Iran, presidential pardons were given to Mechanic, 

Afghahi, and Faridi, and charges were dismissed against other defendants. This case was investigated by 

the FBI, Department of Commerce, and the IRS.

Computers to Iran – On April 6, 2015, in the Northern District of Texas, Borna Faizy, of Frisco, Texas, 

and Touraj Ghavidel, of Plano, Texas -- the corporate owners/operators of Signal Microsystems in 

Addison, Texas, a company that sold computers domestically and internationally – were both sentenced to 

2 years’ probation, $100 special assessment and $75,000 fine. Faizy and Ghavidel both pleaded guilty on 

Sept. 29, 2014, to making false statements to federal agents about the illegal export of computer 

equipment from the United States to Iran. Previously, on March 7, 2013, Faizy and Ghavidel were 

arrested on an indictment alleging that they illegally shipped $12 million worth of computer equipment to 

Iran through Dubai. The indictment, returned under seal in early March 2013, charges each with one 

count of conspiracy to illegally export to Iran, nine substantive counts charging illegal export and 

attempted export of goods to Iran and one count of making false statements to a federal agency. Faizy 

and Ghavidel allegedly acquired computers from U.S. companies to supply to end-users in Iran and 

concealed from the U.S. that the computers were destined for Iran. Faizy and Ghavidel allegedly actively 

recruited Iranian customers by marketing their computer business to business owners and individuals in 

Iran, and, in 2008 or 2009, attended a computer trade show, known as "GITEX," in Dubai to recruit 

Iranian customers. The defendants allegedly used freight-forwarding companies in Dubai to ship the 

equipment to Iran and communicated with coconspirators using fictitious names and coded language to 

obscure the true identities and locations of the ultimate consignees and end-users. They also created 

invoices and export forms that falsely identified the ultimate consignees of the shipments as parties in 

Dubai. The investigation was conducted by members of the North Texas Counter-proliferation Task 

Force, which includes the FBI, ICE, the Department of Commerce and DCIS.

High-Powered Military-Grade Weapons to the Philippines – On March 27, 2015, in the Eastern District 

of New York, two law enforcement officers who used their positions to obtain high-powered militarygrade weapons to smuggle to the Philippines were sentenced to three years in prison, followed by three 

years of supervised release. According to court documents, former New York City Police Officer Rex 

Maralit and his brother Wilfredo Maralit, a U.S. Customs and Border Protection officer assigned to Los 

Angeles International Airport, pleaded guilty on June 12, 2014, for their roles in an illegal scheme to 

smuggle high-powered assault rifles, sniper rifles, pistols, and firearms accessories from the United States 

to the Philippines, violating the Arms Export Control Act. A third brother, Ariel Maralit, resides in the 

Philippines and remains a fugitive. Court documents further alleged that between Jan. 2009, and Sep.

2013, the defendants exported a variety of military-style firearms, along with high-capacity magazines 

and accessories for those weapons, from the United States to the Philippines, where they were sold to 

overseas customers. Both Rex and Wilfredo Maralit used their official credentials and status to obtain and 

ship the weapons without first obtaining a license from the U.S. State Department. The firearms included 

the Barrett .50 caliber long-range semi-automatic rifle, the FN “SCAR” assault rifle, and high-capacity 

FN 5.7mm semi-automatic carbines and pistols which fire a cartridge that was specifically designed to 

penetrate body armor. The Arms Export Control Act requires exporters of firearms to first obtain the 

approval of the U.S. State Department before shipping weapons overseas. Similarly, dealing in firearms is 
47

regulated by the ATF, which requires gun dealers to first obtain a federal firearms license before engaging 

in such a business. This case was investigated by U.S. Immigration and Customs Enforcement’s (ICE) 

Homeland Security Investigations (HSI), Defense Criminal Investigative Service (DCIS), Bureau of 

Alcohol, Tobacco, Firearms, and Explosives (ATF), and New York City Police Department (NYPD).

Aluminum Tubes to Iran – On March 4, 2015, Nicholas Kaiga of Brussels and London, was sentenced in 

the Northern District of Illinois to 27 months’ imprisonment, two years supervised release, and $100 

special assessment after a plea of guilty on Dec. 4, 2014, to one count of attempting to violate the export 

control regulations. Previously, on Oct. 24, 2013, a federal grand jury returned a three -count indictment 

charging Kaiga with one count of violating the International Emergency Economic Powers Act (IEEPA) 

and two counts of making false statements on U.S. export forms. The defendant allegedly attempted to 

export aluminum tubes that were controlled for nuclear nonproliferation purposes from a company in 

Schaumburg, through Belgium, to a company in Kuala Lumpur, Malaysia, without obtaining a license 

from the U.S. Commerce Department. According to the complaint affidavit and indictment, the 

Schaumburg company, identified as "Company A" in court documents, began cooperating with law 

enforcement in Dec. 2007. The cooperation began after a person identified as "Individual A," who was at 

times located in Iran, attempted to purchase 7075 aluminum from Company A, to be shipped to a 

company in the United Arab Emirates, but was denied an export license. In late 2009, an undercover 

agent began posing as an employee of Company A. Between Nov. 2009, and Feb. 2012, the indictment 

alleged that Kaiga, who was managing director of a Belgian company, Industrial Metals and 

Commodities, attempted to export 7075 aluminum from Company A to Company B in Malaysia without 

an export license. The complaint affidavit alleged that Company B was a front for Individual A in Iran. 

The false statements charges allege that Kaiga lied on Commerce Department export declaration forms, 

which stated that the ultimate destination and recipient of the 7075 aluminum were in Belgium. In Nov.

2011, material that was purported to be 7075 aluminum, but was actually substituted with a different 

aluminum by Company A in cooperation with law enforcement, was picked up from Company A by a 

freight forwarding company designated by Kaiga's Belgian company. The material arrived in the Belgian 

port of Antwerp on Dec. 1, 2011, and two months later it was shipped by a freight forwarding company to 

Individual A's front company in Malaysia. This investigation was conducted by HSI, FBI, BIS, and OEE.

Oilfield Service Equipment to Iran – On Feb. 24, 2015, Patrick Jean Zuber, a lawful permanent resident 

of the U.S., was sentenced in the Southern District of Texas to one year of probation, $100 special 

assessment and a $15,000 fine. Previously, on Sep. 24, 2014, Zuber pleaded guilty to a Criminal 

Information charging him with conspiracy to smuggle oilfield service equipment from the United States 

to Iran. Zuber was the Vice President of Middle East and North Africa (MENA) East where he oversaw 

the operations in India, Saudi Arabia, Yemen, Oman, Qatar, Turkmenistan, and Pakistan for Weatherford 

Oil Tool Middle East Limited (WOTME), a wholly owned subsidiary of Weatherford International, Ltd.

(Weatherford), one of the world’s largest oilfield service companies. According to court documents, in 

Jan. 2007, Zuber received an email from a Weatherford manager operating in Thailand asking about 

services Weatherford could provide in Iran. Zuber forwarded the request to a Canadian citizen who was 

Vice President of MENA West and responsible for Weatherford’s sales to Iran. Zuber did this while 

knowing that facilitating the sale of equipment through the United Arab Emirates and on to Iran was 

illegal under United States law.

Military Articles to China – On Feb. 18, 2015, in the Northern District of Illinois, an indictment was 

made public charging an Arlington Heights company, its president, and a former employee with 

unlawfully exporting and importing military articles, including components used in night vision systems 

and on the M1A1 Abrams tank, which is the main battle tank used by the U.S. Armed Forces. The 

defendants were charged in an indictment returned by a federal grand jury on Jan. 14, 2015. Defendant 

Vibgyor Optical Systems, Inc. purported to manufacture optics and optical systems, including items that 
48

were to be supplied to the U.S. Department of Defense (DOD). Instead of manufacturing the items 

domestically, as it claimed, Vibgyor illegally sent the technical data for, and samples of, the military 

articles to manufacturers in China, then imported the items from China to sell to its customers – including 

DOD prime contractors. Vibgyor’s president, Bharat “Victor” Verma, and Urvashi “Sonia” Verma, a 

former Vibgyor employee and owner of a now-defunct company that operated as a subcontractor for 

Vibgyor, were also charged in the indictment. According to the indictment, between Nov. 2006, and 

March 2014, the defendants conspired to defraud the United States and violate both the Arms Export 

Control Act (AECA) and International Traffic in Arms Regulations (ITAR). Vibgyor won subcontracts to 

supply optical components and systems to DOD prime contractors by misrepresenting the location of the

manufacture of the items it supplied. Bharat Verma falsely claimed that the items Vibgyor supplied were 

manufactured domestically, when they actually had been manufactured in China, based on information 

illegally exported to Chinese manufacturers. In addition to illegally providing technical data for a military 

item to China, Urvashi Verma attempted to ship an example of one of the military items to the Chinese 

manufacturer. Vibgyor, Bharat Verma, and Urvashi Verma are charged with one count of conspiracy to 

violate both the AECA and the ITAR, one count of conspiracy to defraud the United States, and one count 

of violating the AECA. Vibgyor and Bharat Verma were also charged with international money 

laundering. On October 24, 2017, Vibgyor and Bharat Verma pleaded guilty to conspiracy to violate the 

AECA and to knowingly defraud the United States; Bharat Verma also pleaded guilty to international 

money laundering. On November 15, 2017, a federal jury convicted Urvashi Verma of one count of 

conspiracy to violate the AECA. Sentencing is expected in 2018. This case was investigated by Homeland 

Security Investigations, Internal Revenue Service, and Defense Criminal Investigative Service.

Military Night Vision Devices Overseas – On Feb. 9, 2015, in the District of Maryland, David Kelley 

was sentenced to 18 months in prison followed by three years of supervised release after a plea of guilty 

on May 9, 2014, for the unlawful export of arms and munitions, specifically, night vision devices, in 

violation of 22 U.S.C. § 2778. According to his plea agreement, Kelley ran a business named "Optical 

Solutions and More" that sold night vision and other military-style items, primarily over eBay. Kelley 

entered into distributor agreements with night vision manufacturers in which he acknowledged that he 

was aware of restrictions known as the International Traffic in Arms Regulations (ITAR), 22 C.F.R. §§ 

120-130, which prohibited the unlicensed export of U.S. munitions list items, including the export of 

night vision devices using Generations 2 and newer technology. After entering into these agreements, 

Kelley discussed circumventing ITAR restrictions with foreign customers who responded to his internet 

listings. Between May 2011, and Feb. 2012, Kelley made approximately 60 shipments containing ITARrestricted weapons parts and night vision devices destined for customers in 24 countries, including 

Argentina, Australia, Russia, the Philippines, United Kingdom and Japan. To disguise the ITAR 

violations, Kelley variously labeled these shipments as "toys," "toy blocks," "spotting scope," and 

"monocular parts." In exchange for these shipments, Kelley collected over $140,000 in 150 separate 

PayPal transactions. In Sep. 2011, an undercover HSI agent located in Baltimore posed as a buyer from 

New Zealand and contacted Kelley to ask if Kelley would export an ATN Generation 4 Monocular Night 

Vision Device. Kelley acknowledged in an email that such an export violated ITAR and demanded 

additional payment for risking prosecution. On Oct. 24, 2011, Kelley exported the device, which is 

designated as a defense article on the U.S. munitions list, to New Zealand, without first obtaining a 

license from the State Department.

Industrial Products to Iran – On Feb. 2, 2015, in the District of Maryland, Ali Saboonchi, a U.S. citizen, 

was sentenced to 2 years in prison, 1 year supervised release, and $800 special assessment. Previously, on 

Aug. 11, 2014, a federal jury convicted Saboonchi of conspiracy and seven counts of exporting U.S. 

manufactured industrial products and services to Iran, in violation of the International Emergency 

Economic Powers Act. On March 7, 2013, an indictment was unsealed charging Saboonchi and Arash 

Rashti Mohammad, a citizen and resident of Iran, with conspiracy to export and exporting U.S. 
49

manufactured industrial products and services to Iran. The indictment was returned on March 4, 2013, 

and unsealed upon Saboonchi's arrest. From Nov. 2009, to the present, Saboonchi and Rashti conspired 

to evade the Iranian embargo by exporting U.S. manufactured industrial goods and services to Iranian 

businesses. Rashti, located in Iran, allegedly asked Saboonchi, located in Maryland, to create and operate 

Ace Electric Company for the purpose of obtaining goods to send to Iran. Rashti, who operated 

businesses in Iran and the United Arab Emirates (UAE), allegedly solicited business from customers in 

Iran for industrial parts and components manufactured in the United States. Saboonchi obtained price 

quotes, paid for, and took delivery of most of the U.S. goods. He then caused the goods to be shipped to 

co-conspirators in UAE, and in at least one case, China. Rashti would repay Saboonchi and then arrange 

for the entities in the UAE and China to send the goods to him and his customers in Iran. Finally, the 

defendants did not obtain a license or authorization to export these goods to Iran. Rashti remains at large. 

On Aug. 9, 2016, the Court dismissed the indictment against Rashti, Mehdi Mohammadi, and Eshan 

Naghshineh. The investigation was conducted by the FBI and ICE.

Sanctions Violations to Aid Zimbabwean Government Officials – On Jan. 21, 2015, C. Gregory Turner, 

also known as Greg Turner, was sentenced in the Northern District of Illinois to 15 months in prison, one 

year supervised release, $100 special assessment, and a fine of $90,000. Previously, on Oct. 10, 2014, 

Turner was convicted by a federal jury of conspiracy to violate the International Emergency Economic 

Powers Act (IEEPA) from late 2008 through early 2010 by agreeing to assist Zimbabwe President Robert 

Mugabe and others in an effort to lift economic sanctions against Zimbabwe. Turner met multiple times in 

the United States and in Africa with Zimbabwean government officials, including President Mugabe and 

Gideon Gono, governor of the Reserve Bank of Zimbabwe, who were individually subject to U.S. 

sanctions. A Nov. 2008, consulting agreement provided for a total payment of $3.4 million in fees for 

Turner and his co-defendant, Prince Asiel Ben Israel, to engage in public relations, political consulting, 

and lobbying efforts to have sanctions removed by meeting with and attempting to persuade federal and 

state government officials, including Illinois members of Congress and state legislators, to oppose the 

sanctions. President Mugabe and his ruling ZANU-PF party have governed Zimbabwe since its 

independence in 1980. The sanctions against President Mugabe and other specially designated individuals 

in Zimbabwe – for human rights abuses – neither bar travel to Zimbabwe nor prohibit public officials 

from meeting with specially designated nationals to discuss removing the sanctions. But, individuals may 

not provide services on behalf of or for the benefit of specially designated nationals. According to the 

evidence at trial, in early Nov. 2008, Turner and Ben Israel began having discussions with Mugabe, 

Gono, and other ZANU-PF leaders regarding the influence Turner and Ben Israel could wield to have the 

sanctions removed. The defendants discussed with President Mugabe, Gono, and others their association 

with many public officials who purportedly had close connections with then President-Elect Obama. 

Turner violated IEEPA by conspiring to engage in public relations, political consulting, and lobbying 

efforts on behalf of President Mugabe and other Zimbabwe officials. In early Dec. 2008, Ben Israel’s U.S. 

bank blocked a wire transfer of $89,970 into his account from a Zimbabwean official affiliated with 

ZANU-PF; and, Ben Israel later traveled to Africa and personally withdrew $90,000 from the bank 

account of that same Zimbabwean official. Turner and Ben Israel arranged for trips by federal and state 

government officials to meet with President Mugabe and other Zimbabwean officials, including in Nov.

and Dec. 2008, and Jan. and Dec. 2009; attempted to have Gono and other Zimbabwean officials speak at 

an issues forum in Washington, D.C., sponsored by a then-U.S. Representative from California, and to 

assist those officials in obtaining visas to travel to the U.S. to attend the event; arranged for President 

Mugabe to meet with federal and state government officials in New York; lobbied a caucus of state 

legislators on behalf of Zimbabwean officials; and failed to apply to the Treasury Department for a 

license to engage in transactions and services on behalf of specially designated nationals. In early Dec.

2008, Turner and Ben Israel arranged for a delegation to travel to Zimbabwe. After members of the 

delegation returned, President-Elect Obama’s transition team forwarded information about contact from a 

member of the delegation to the FBI based on its concerns that sanctions may have been violated by 
50

traveling to Zimbabwe, which was not itself prohibited. Throughout 2009, Turner and Ben Israel 

continued to pass communications between Zimbabwean leaders and, purportedly, U.S. public officials 

while seeking payment for their services from Gono. Ben Israel was sentenced on Aug. 21, 2014, to seven 

months in prison, one year supervised release, $100 special assessment and a $500 fine after pleading 

guilty to violating the Foreign Agents Registration Act (FARA). This case was investigated by the 

Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigation Division.

Lockheed Martin Fuel Quantity Indicators to Malaysia – On Jan. 13, 2015, in the District of New 

Hampshire, Netria Corporation was sentenced to one year of probation and ordered to forfeit $12,560. 

On Oct. 2, 2014, Netria pleaded guilty to a one-count Information charging it with exporting without a 

license two Lockheed Martin Fuel Quantity Indicators, which are defense articles on the Munitions List, 

in violation of the Arms Export Control Act (AECA). According to court documents, in Sep. 2008, a 

domestic undercover storefront received a request from a Netria employee for a quote for a Northrup 

Grumman F-14 Tomcat fighter aircraft part. Subsequent to the request, federal agents began an 

investigation into Netria’s sales and export activities. During the course of the investigation, it was 

discovered that Netria had made sales and exports of numerous shipments of parts belonging to the 

Lockheed Martin C-130 Hercules military aircraft. A portion of those sales and exports consisted of parts 

and equipment which were classified as defense articles under the AECA and require a license from the 

Department of State prior to export out of the United States. In all, Netria exported nine shipments of C130 parts from Sep. 2008, through April 2009, without a license and brokered the sale and export of 

approximately $2 million in such aerospace parts between July 2007, and Oct. 2009. This case was

investigated by ICE/HSI and DCIS.

Drone, Missile and Stealth Technology to China – On Jan. 9, 2015, Hui Sheng Shen, a/k/a Charlie, was 

sentenced in the District of New Jersey to 49 months in prison and $200 special assessment. On Jan. 6, 

2015, Huan Ling Chang, a/k/a “Alice” was sentenced to time served and $200 special assessment. 

Previously, on Sep. 22, 2014, Shen and Chang, both Taiwanese nationals, each pleaded guilty to one 

count of conspiracy to violate the Arms Export Control Act and one count of conspiracy to import illegal 

drugs. On April 25, 2012, Shen and Chang were charged separately by amended criminal complaints 

with conspiracy to violate the Arms Export Control Act. The defendants were arrested on Feb. 25, 2012,

in New York in connection with a complaint in New Jersey charging them with conspiring to import and 

importing crystal methamphetamine from Taiwan to the United States. According to the amended 

complaint, during negotiations with undercover FBI agents over the meth deal, the defendants asked FBI 

undercover agents if they could obtain an E-2 Hawkeye reconnaissance aircraft for a customer in China. 

In subsequent conversations, Shen and Chang allegedly indicated they were also interested in stealth 

technology for the F-22 fighter jet, as well missile engine technology, and various Unmanned Aerial 

Vehicles (UAV), including the RQ-11b Raven, a small, hand-launched UAV used by the U.S. Armed 

Forces. Shen and Chang allegedly stated that their clients were connected to the Chinese government and 

its intelligence service. According to the complaint, they sent undercover agents a code book to facilitate 

communications relating to the proposed arms exports and opened a bank account in Hong Kong to 

receive and disburse funds related to the transactions. On a visit to New York in Feb. 2012, the 

defendants allegedly examined a Raven RQ-11b UAV and manuals relating to the RQ-4 Global Hawk 

UAV (provided by undercover FBI agents) that they allegedly intended to export to China. Shen and 

Chang were arrested shortly thereafter. The export investigation was conducted by the FBI, while ICE 

was responsible for a parallel investigation into the import of counterfeit goods from China involving 

other defendants.

###