U.S. prosecutors have indicted a Taiwanese father and son on charges related to the supply of machinery to North Korea that could be used in the production of weapons of mass destruction.
Hsien Tai “Alex” Tsai, 67, and his son, Yueh Hsun “Gary” Tsai, 36, were charged during a Monday afternoon hearing at federal court in Chicago. Both were arrested last week.
Alex Tsai was picked up in Estonia, where he remains in custody awaiting extradition to the U.S., and Gary Tsai was arrested at his home in Glenview, Illinios. Gary Tsai is a legal permanent resident of the U.S.
In two almost identical 34-page indictments, filed in mid-April but only unsealed today, the U.S. Federal Bureau of Investigation lays out a series of attempts by the two to obtain and export precision metal fabrication equipment.
The two individuals and a third Taiwanese business associate attempted to hide the purchases by using three Taiwanese companies: Global Interface Company, Trans Merits, and Trans Multi Mechanics, the FBI alleges.
It detailed three alleged transactions that took place in the latter half of 2008, just months before the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) designated Alex Tsai, his wife and two of the companies as proliferators of weapons of mass destruction.
The designation, which came while some of the machinery was still on a ship yet to reach Taiwan, said Tsai had provided, or attempted to provide, “financial, technological or other support for, or goods or services in support of the Korea Mining Development Trading Corporation (KOMID).” KOMID has been accused of dealing in weapons of mass destruction or ballistic missiles.
But that didn’t stop Tsai, according to the complaint.
In September 2009, he purchased and exported machinery under the name of Trans Multi Mechanics and started conducing business under a new company, Factory Direct Machine Tools, the complaint said.
As a result of the charges, the two both face one count of conspiring to defraud the U.S. in its enforcement of laws and regulations prohibiting the proliferation of weapons of mass destruction, one count of conspiracy to violate the International Emergency Economic Powers Act (IEEPA) by conspiring to evade the restrictions imposed on Alex Tsai and two of his companies by the U.S. Treasury Department, and one count of money laundering.
The two former charges carry penalties of up to 20 years in prison and fines of $1 million and $500,000 respectively. The money laundering charge carries a maximum sentence of 5 years in prison and a $250,000 fine.