From 2018 – 2020, Ms. Lin Chen and Mr. Han Li exported goods and services from the United States to the Chengdu GaStone Technology Co. and China Electronics Technology Corporation, 55th Research Institute, a State Owned Enterprise. Both entities support China’s defense establishment and US exports are prohibited without a Department of Commerce (DOC) license.
Chen and Li, along with California based Dynatex International, exported a DTX-150 Automatic Diamond Scriber Breaker to GaStone (Used to cut thin semiconductors). They shipped numerous other export restricted items to GaStone and the 55th Research Institute. Li and Chen used a company they controlled, Jiangsu Hantang International Trade Group Corp in Nanjing, PRC, as the destination entity on the shipping paperwork. They submitted false information through the DOC Automated Export System, by stating no license was required for the export and that the end user for the of the DTX-150 Automatic Diamond Scriber Breaker was Jiangsu Hantang International Trade Group Corp.
Chen and Li are residents of the PRC. Arrest warrants were issued in 2020. The FBI arrested Chen in April 2024 during a trip to the US. Chen had at least one daughter who attended college in the US and one who was resident in New York. Both have returned to China. Li remains a fugitive in China. Dynatex was fined $419,000 in 2021. *
Tradecraft
1. Targeted specific technologies for the People‘s Liberation Army.
2. Use of open emails and phones between Chen, Li, and Dynatex and other US companies.
3. Submitted false statements to the USG to conceal the end-user of the controlled items.
4. Use of front company in China to receive restricted US technology.
5. Used financial institutions located in China to send payments to financial institutions located within the United States.
6. Li and Chen instructed Dynatex International to ensure that the export information associated with the sale did not list GaStone as the ultimate consignee of the shipment.
*Note In 2018, GaStone was involved in another criminal act to illegally access an American company’s technology on monolithic microwave integrated circuits
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