Three sentenced for providing tech to China

One defendant shipped integrated circuits out of the U.S., the DOJ says

Three men have been sentenced to U.S. prison for attempting to transport sensitive and advanced U.S. technology, including integrated circuits, to China, the U.S. Department of Justice said.

William Chi-Wai Tsu, 61, a Beijing resident, was sentenced Monday to 40 months in prison for his role in exporting high-tech integrated circuits with military applications to China.

In a separate case, Tah Wei Chao, 53, of Beijing, was sentenced Monday to 20 months in prison after pleading guilty to attempting to smuggle 10 highly sensitive and advanced thermal-imaging cameras to China. Chao's codefendant, Zhi Yong Guo, 50, also of Beijing, was sentenced on July 27 to five years in federal prison in connection with smuggling thermal-imaging cameras.

All three defendants were sentenced by Judge John Walter of U.S. District Court for the Central District of California. The three men were charged under the International Emergency Economic Powers Act (IEEPA) and Export Administration Regulations (EAR) for illegally exporting sensitive technology in violation of United States export laws.

Tsu, who was vice president of U.S.-based Cheerway Trading, illegally shipped more than 400 sophisticated integrated circuits to China, the DOJ said. Tsu was arrested on Jan. 10, and he pleaded guilty to two felony counts on March 13. Investigators said the thumbnail-size circuits that were shipped out of the country have a variety of potential applications, including use in sophisticated communications and military radar systems.

Prosecutors argued in a sentencing brief that Cheerway was a front company that Tsu used to ship items to his Beijing-based company, called Dimagit Science & Technology. Dimagit's catalog was imprinted with images of military craft and clearly explained Tsu's business: "to facilitate the building of the national defense of China" and to "revitalize the Chinese military industry," the DOJ said.

Prosecutors also argued that Tsu supplied restricted U.S. technology to several customers in China, including the 704 Research Institute, which is also known as the Aerospace Long March Rocket Technology and is affiliated with the state-owned China Aerospace Science & Technology, the DOJ said.

Under IEEPA and EAR, the U.S. bars the export of sensitive technology and equipment to certain countries. The integrated circuits and the thermal-imaging cameras involved in these two cases are considered "dual-use" items, meaning they have potential military applications as well as nonmilitary uses. Their export to China requires permission from the U.S. Department of Commerce.

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Grant Gross

IDG News Service
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