Two Chinese nationals have been charged for an alleged scheme to illegally export a semiconductor dicing machine to a Chinese tech company. One of the two, Han Li, 44, was arrested in Chicago on Wednesday, while Lin Chen, 64, is believed to be in China. The charges and arrest are the latest developments in a protracted trade war between China and the U.S. over advanced computer processing.
Between May 2015 and August 2018, Li and Chen allegedly made plans to obtain a DTX 150 Scribe and Break machine from Dynatex, a high-precision silicon wafer dicing tool. The two were to export the tool to Changdu GaStone Technology Company in China, a company on the United States Department of Commerce’s banned entity list and thus ineligible to receive certain tech and services from the U.S. The pair is also charged with violating the International Emergency Economic Powers Act (IEEPA), a law enabling the president to regulate international commerce in the case of a national emergency. IEEPA has been used to lock down commerce with China since the Trump era.
Other charges include breaking Export Administration Regulations and illegal smuggling, which carry a combined maximum sentencing of 55 years in prison and $2.5 million in fines. However, this level of punishment is extreme and unlikely.
I wonder how they got caught with all the tech that goes back and forth between the US and China.
It seems like the US was aware of their plans based off of the articles wording but I’d be curious to hear how they originally were flagged. I wonder if it was just for buying the DTX 150 Scribe and Break machine from Dynatex and possibly being Chinese citizens.
Reading the DoJ press release a while back on another case with some Russians who had been exporting sanctioned devices to Russia, US law enforcement had clearly been monitoring their communications for some time, as they quoted communications between them.
I work in manufacturing and these US companies are all registered with multiple US agencies. There are tons of regulations controlling what you sell to whom if you’re working in an area that is considered a national security priority.
For a big precision machine like this one they probably file a report for each one they sell, and include to whom they are selling. If these buyers proferred false docs they would be immediately flagged for a three letter agency to review when the seller’s docs hit the system.
Neat. Thanks for the insight