Chinese National Pleads Guilty in Scheme to Illegally Export US Semiconductor Technology to China

A Chinese national on Oct. 17 pleaded guilty to illegally exporting U.S. semiconductor equipment to a U.S.-sanctioned company in China, according to the U.S. Attorney’s Office for the Northern District of California.
Wafer-cutting machines are precision tools used in the semiconducting manufacturing process to cut semiconductor wafers into smaller pieces.
A federal grand jury indicted Chen in December 2020, charging him with conspiracy to violate the International Emergency Economic Powers Act (IEEPA), submitting false electronic export information, smuggling, and IEEPA violations. Under his plea agreement, Chen pleaded guilty to causing an unlawful export in violation of the IEEPA.
If convicted, Chen faces a maximum prison sentence of 20 years and a fine of up to $1 million.
Chen and his co-defendant, Li Han, allegedly intended to procure a DTX-150 Automatic Diamond Scriber Breaker machine, a wafer-cutting machine, from California-based firm Dynatex International and sell it to China-based Chengdu GaStone Technology, officials say.
To skirt U.S. regulations, Chen and Li allegedly attempted to buy the machine in the name of a Chinese company called Jiangsu Hantang International Trade Group, which would act as an intermediary to conceal GaStone as the true end user of Dynatex’s machine, officials say.
According to the plea agreement, Chen revealed that he and Li arranged the sale on Dec. 10, 2015.
Federal prosecutors said in April that they believed that Li, a Chinese national, was in China.
“Stopping the flow of U.S. semiconductor technology that supports the [People’s Republic of China’s] military modernization efforts is a top priority for the Office of Export Enforcement,” Brent Burmester, a special agent in charge of the Commerce Department, said at the time.
“BIS will continue to prioritize investigations involving exports of advanced technologies to prohibited parties to protect U.S. national security.”
The Epoch Times contacted Chen’s lawyer for comment but did not receive a response by publication time.
Chengdu GaStone Technology was also implicated in another recent case.
According to the DOJ, “MMICs are used in missiles, missile guidance systems, fighter jets, electronic warfare, electronic warfare countermeasures, and radar applications.”