Posted by CotoBlogzz
Rancho Santa Margarita, CA Kan Chen, 26, 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, according to announcement by Assistant Attorney General for National Security John P. Carlin.
On June 16, 2015, Chen was arrested by Homeland Security Investigation ( 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 above charges on March 2, 2016.
“The United States will simply never know the true harm of Chen’s conduct because the end users of the rifle scopes and other technology are unknown,” said U.S. Attorney Oberly. “No matter their nationality, those individuals who seek to profit by illegally exporting sensitive U.S. military technology will be prosecuted. It is important that we take all necessary steps to prevent our military technology and equipment from being exported and possibly used against our service members and our allies overseas.”
According to court records, 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-ship 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.
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 Commerce-Bureau of Industry and Security’s Office of Export Enforcement.
It is being prosecuted by Assistant U.S. Attorneys Jamie M. McCall and Elizabeth L. Van Pelt of the District of Delaware and the National Security Division’s Counterintelligence and Export Control Section.
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