Radiation-Hardened Circuits to China

On December 18, 2013, Chinese citizen and former California Department of Transportation (Caltrans) engineer Philip Chaohui He was sentenced in the District of Colorado for exporting radiation-hardened integrated circuits from the United States to China, in violation of the Arms Export Control Act, 22 U.S.C. § 2778. He was sentenced to 36 months imprisonment followed by 3 years of supervised release. He pleaded guilty on September 3, 2013. According to documents filed in the case, He was arrested as he was attempting to deliver the circuits onto a Chinese ship at the Long Beach, California port. Upon a search of He’s vehicle, agents located more than 300 space-qualified and radiationhardened computer circuits concealed inside plastic infant formula containers. The circuits are used in satellite communications and had a total value of nearly $550,000. He did not have a State Department license. A December 15, 2011 indictment charged He with conspiracy to violate the Arms Export Control Act (AECA) and to smuggle goods; attempted violation of AECA; and smuggling. According to the charges, He, the only employee of an Oakland company called Sierra Electronic Instruments, arranged for the purchase of more than 300 radiation-hardened circuits from Aeroflex, a Colorado manufacturer, in May 2011. He arranged for the purchase after a co-conspirator sent him wire transfers totaling nearly $490,000 from a bank in China. He then provided false certification to Aeroflex that the items would remain in the United States. He received the first shipment of 112 circuits from Aeroflex in July 2011 and later traveled from Mexico to Shanghai in September. In October 2011, he received a second shipment of 200 circuits from Aeroflex. He drove to the Port of Long Beach in December 2011 and met with two men in front of a docked Chinese-flagged ship that was registered to a subsidiary of a China state-owned corporation. The ship had recently arrived from Shanghai and was scheduled to return on December 15, 2011. He had allegedly concealed the 200 circuits in infant formula containers within boxes labeled “milk powder” in the trunk of his vehicle. He was arrested on December 11, 2011 at the Port. This investigation was conducted by ICE and DCIS and Defense Security Service.