Two Cases Aim to Cut Off China and Iran From U.S. Technology



    The U.S. government announced charges in two separate cases on Wednesday aimed at enforcing laws blocking the transfer of critical technologies, part of a broader campaign to hamper military efforts and weapons production in rival countries.

    One of the complaints was against a U.S. citizen born in China who has been arrested and accused of stealing trade secrets from a private company. The technology, according to court documents, “would be dangerous to U.S. national security if obtained by international actors.”

    A Justice Department complaint filed in U.S. District Court in California said the stolen material would help the development of technology that allows space-based systems to track ballistic and hypersonic missiles. U.S. officials said technology related to hypersonic missiles and missile tracking was among the Chinese military’s top priorities.

    In the other complaint, the U.S. government accused two Iranian men of trying to illegally procure American goods and technology for Iran’s aerospace industry. The technology, according to court documents, involved firefighting equipment and flame detectors.

    The charges are the latest in a series of legal actions aimed at cutting off Iran, Russia and China from American technology. A year ago, the Justice and Commerce Departments formed the Disruptive Technology Strike Force to enforce export control laws and disrupt production of weaponry in Iran meant for Russia and Iranian proxy groups. It was also intended to stall China’s efforts to develop advanced military technology.

    Officials from the strike force are meeting with Ukrainian representatives this week in Phoenix to discuss efforts to stop the flow of American technology and U.S.-designed components to Russia, Iran and China.

    “Our mission is to keep our country’s most sensitive technology out of the world’s most dangerous hands,” said Matthew S. Axelrod, the Commerce Department’s assistant secretary for export enforcement. “Nation-state actors are attempting to acquire advanced U.S. technology so they can modernize their militaries to such a degree that they leapfrog ours and change the balance of power in the world. Those are the stakes.”

    American export controls aimed at Beijing have tried to block its government and Chinese companies from acquiring advanced chips that can be used to develop new military capabilities. Iran, however, is trying to acquire less sophisticated technology and chips, whose export to many other countries is not blocked.

    Iran uses those chips to build drones that it supplies to Russia for its war in Ukraine and to Hamas and Houthi rebels, who have used them to attack ships in the Red Sea.

    “Iran’s malign activity is both destabilizing in the region and supports other malign actors like Russia,” said Matthew G. Olsen, the assistant attorney general for the national security division of the Justice Department.

    When Mr. Olsen traveled to Kyiv in November, Ukrainian officials presented him with evidence of American technology being used in the Iranian-produced drones that had attacked Ukraine. He said the visit had expanded intelligence sharing between the countries to bolster the American legal investigations.

    American officials said it was hard to judge the direct effect of the export controls. Russian production of missiles, for example, was initially slowed by export restrictions. But as Moscow refocused its economy on wartime manufacturing, its missile-production level returned to, then exceeded, prewar capacity.

    Iran’s drone production has fluctuated, potentially because of U.S. pressure on its supply chain. And American officials say they are at the least making it far more expensive and difficult for Iran to supply both its proxy forces and Russia.

    “When we’re enforcing sanctions and export control laws, we want to impose costs on the bad actors, including Russian and Iranian actors,” Mr. Olsen said. “We want to charge them, out them publicly and, if possible, arrest them.”

    The enforcement actions also have ripple effects, Mr. Olsen said. Bigger companies see how Iran, Russia or China are trying to evade rules and adopt stronger compliance efforts to make sure they are not used in any effort to smuggle the chips.

    “Companies take notice when there’s criminal enforcement and implement stronger compliance regimes,” he said.

    In the China case unveiled on Wednesday, a 57-year-old man, Chenguang Gong, was charged with theft of trade secrets. Prosecutors accused Mr. Gong of stealing files last year from a technology company that was not identified. The government complaint does not say if the technology — to identify missile launches and track hard-to-detect objects from space — was sent to China.

    But Mr. Gong did not have the software to view the files he had taken from the company, prosecutors wrote in their complaint. Some of the documents were labeled proprietary, and others were labeled export controlled.

    Mr. Gong, who had worked for defense contractors and had expertise in developing computer circuits, had previously sought funding from the Chinese government, contacting officials through its various “talent programs.” Beijing uses the programs to identify people who can help develop its economy and military capabilities.

    The Iran case was not directly related to the country’s drone production but was tied to its aerospace industry.

    Abolfazi Bazzazi, 79, and his son, Mohammad Resa Bazzazi, 43, were accused of creating an intricate scheme to avoid export laws to send aerospace equipment to Iran, shipping the technology to Europe to hide its final destination.

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