California Company, President, Employee Charged With Violating ECRA
The Department of Justice charged a California electronics company, its president and an employee with trying to illegally export chemicals to a Chinese company on the U.S. Entity List. President Tao Jiang, employee Bohr Winn-Shih and the company, Broad Tech System Inc., ordered the chemicals from a Rhode Island company before trying to ship the items to China Electronics Technology Group Corporation 55th Research Institute (aka NEDI) (see 2006030032), the Justice Department said July 20. The shipment would have violated the Export Control Reform Act.
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Broad Tech tried to ship two types of chemicals used in chip manufacturing: HiPR 6517 Photoresist and HPRD 441 Developer. CBP intercepted the first shipment of 58 gallons of photoresist in 2018 and alerted the Commerce Department, which halted the export after it informed the Rhode Island manufacturer that the shipment was subject to export controls.
Soon after, Broad Tech tried to place another order with the Rhode Island company for chemicals, saying the ultimate customer was based in China. The Rhode Island company reached out to Commerce agents, saying it was “suspicious” of the order because it had never done business with Broad Tech, which tried to buy a “significant quantity” of photoresist.
To try to complete the shipment, Jiang, Shih and Broad Tech gave false information to a California-based freight forwarder about the end-user, listing the customer as “NTESY” instead of NEDI. During an investigation, the DOJ said Broad Tech received a $65,000 wire transfer from NTESY Technology Co., but the transfer originated from an account controlled by NEDI, a Chinese state-owned company. NEDI manufacturers and develops core chips for Chinese military strategic early warning systems and “other national large-scale projects,” the Justice Department said.