Pressure Transducers with Nuclear Applications to China and Elsewhere

On July 24, 2014, in the District of Massachusetts, Qiang Hu aka Johnson Hu, a Chinese national and resident of Shanghai, was sentenced to 34 months in federal prison and $100 special assessment. Hu pleaded guilty on October 16, 2013 for his role in a conspiracy scheme to export dual-use pressure transducers from the United States to China. Previously, on June 13, 2012, a grand jury returned an indictment charging Hu with conspiracy to illegally export from the United States to China and elsewhere dual-use pressure transducers, in violation of the International Emergency Economic Powers Act (IEEPA). Pursuant to a criminal complaint, Hu was arrested on May 22, 2012, after he arrived in Massachusetts for a business meeting. According to the indictment, the pressure transducers in question, manufactured by MKS Instruments headquartered in Andover, Mass., are controlled for export by the Commerce Department because they can be used in gas centrifuges to enrich uranium and produce weapons-grade uranium. Specifically, they can be used to measure gas pressure of uranium hexafluoride in centrifuge cascades. The indictment claims that Hu worked as a sales manager for a subsidiary of MKS Instruments in Shanghai, where he has been employed since 2008. Hu and his co-conspirators allegedly caused thousands of MKS export-controlled pressure transducers, worth more than $6.5 million, to be illegally exported from the United States to unauthorized end-users in China and elsewhere using export licenses fraudulently obtained from the Department of Commerce. The indictment alleges that Hu and his co-conspirators used two primary means of deception to export the pressure transducers. First, the conspirators used licenses issued to legitimate MKS business customers to export the pressure transducers to China, and then caused the parts to be delivered to other endusers who were not themselves named on the export licenses or authorized to receive the parts. Second, the conspirators obtained export licenses in the name of a front company and then used these fraudulently obtained licenses to export the parts to China, where they were delivered to the actual end-users. MKS is not a target of the federal investigation into these matters. This investigation was conducted by FBI, ICE, and BIS.