Chinese citizen pleads guilty to attempting to smuggle US military equipment to PRC

Dingwei Chen, a 29-year-old Chinese national, has pleaded guilty in federal court to charges stemming from an attempt to illegally acquire and smuggle sensitive U.S. military communications equipment to the People's Republic of China.

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Today’s guilty plea underscores the serious consequences for those who attempt to illegally procure, export, or transfer sensitive US-origin military equipment.

Chen engaged in efforts to purchase U.S.-manufactured military-grade hardware, including radios and satellite modems, through illicit channels. Working with individuals in China, he made initial payments totaling $40,000 and later an additional $30,000 in cryptocurrency for ten satellite modems. The use of cryptocurrency and encrypted apps was intended to evade law enforcement detection.

According to the U.S. Justice Department, Chen and his co-conspirators discussed covert export plans, considering routes through Switzerland and the Northern Mariana Islands before settling on smuggling the equipment via Mexico. Such hardware is strictly regulated and requires a license from the U.S. State Department's Directorate of Defense Trade Controls for export.

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Chen worked with individuals in China to acquire the communications systems from foreign arms dealers, eventually making a down payment of $40,000 to secure the technology.

Assistant Attorney General for National Security John A. Eisenberg stated that the successful diversion of this equipment could have potentially been used against the United States. Chen's guilty plea was accepted in a federal court in Salt Lake City, where he now faces a maximum sentence of 20 years imprisonment for violating the U.S. Arms Export Control Act.

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Chen and his accomplices shifted to using cryptocurrency because, according to the DOJ, they noted that cryptocurrency wallets “are essentially anonymous bank accounts. Each transaction processed through them is private and untraceable.”