The three defendants are charged with illegally redistributing military semiconductors and selling counterfeit hardware to US military contractors.
“In October 2014 and in March 2015, Yan (Ben Yan, one of the three men charged) sold a total of 45 counterfeit Intel microprocessors to an undercover agent who had advised Yan that the components would be used on a U.S. Navy contract involving submarines,” says the DoJ.
“The Justice Department and our federal law enforcement partners are committed to prosecuting those who would supply our armed forces with counterfeit electronic components, as well as those who attempt to steal sophisticated U.S. military components and distribute them places unknown,” said U.S. Attorney Deirdre Daly.
Also Yan is charged with asking an undercover investigator to sell him 22 military-grade Xilinx semiconductors for $37,000 each.
“After the undercover agent advised Yan that the Xilinx components could be stolen from a U.S. Navy base,” says the DoJ, “Yan offered to provide fake Xilinx components that could be substituted for the stolen components in order to prevent detection of the theft.”
All three are charged with violating the International Emergency Powers Act and receiving stolen government property.
They are also facing charges of trafficking counterfeit goods, mail fraud and conspiracy.
The charges could result in decades in prison and millions of dollars in fines.