A U.S. businessman and his New York-based company and two others and their company in California were indicted today in Washington, D.C., on charges of illegally exporting millions of dollars worth of computer-related equipment from the United States to Iran via the United Arab Emirates (UAE).
Jeng “Jay” Shih, 53, a U.S. citizen, and his Queens, New York company, Sunrise Technologies and Trading Company, were indicted in the District of Columbia on 27 counts relating to the illegal export of computer-related equipment to Iran without first having obtained the required license from the Department of Treasury.
The indictment charges Shih and his company with one count of conspiracy; 13 counts of violating the International Emergency Economic Powers Act (IEEPA); 13 counts of making or causing to be made false statements to the United States; and one allegation for criminal forfeiture of property and proceeds derived from these offenses.
Shih was arrested on a criminal complaint in New York on April 6, 2011, and had his initial appearance in court in New York on April 7, 2011. If convicted, he faces a maximum sentence of 20 years in prison and a $1 million fine for each of the IEEPA counts and five years for each false statement count.
In addition, Massoud Habibion, 48, aka “Matt Habibion” and “Matt Habi,” and Mohsen Motamedian, 43, aka “Max Motamedian” and “Max Ehsan,” both U.S. citizens, and their Costa Mesa, California, company, Online Micro LLC, were indicted in the District of Columbia on 32 counts relating to the illegal export of computer-related equipment to Iran without the required license from the Department of Treasury.
Habibion was charged with one count of conspiracy, 14 counts of violating IEEPA, 14 counts of making or causing false statements to the United States and four counts of obstruction of justice. Motamedian was charged with one count of conspiracy, 14 counts of violating IEEPA, 14 counts of making or causing false statements to the United States and one count of obstruction of justice.
Habibion and Motamedian were arrested on a criminal complaint in California on April 7, 2011, and had their initial appearance in court in the Central District of California on April 7, 2011. If convicted, both defendants face a maximum sentence of 20 years in prison and $1 million fine for each of the IEEPA counts, and five years for each false statement and 20 years for each obstruction of justice count.
According to the affidavit filed in support of the Shih criminal complaint, in 2006, Commerce Department agents conducted an outreach visit to Shih’s business in New York where they met Shih and informed him about U.S. laws governing the export of goods from the United States to other countries, particularly embargoed countries like Iran. In April 2010, ICE-Homeland Security Investigations (HSI) agents seized hundreds of laptop computers that originated from Sunrise and were destined for Dubai, UAE. Communications related to these shipments indicated that the purchasers were located in Iran, according to the affidavit.
The affidavit alleges that agents subsequently identified a company in Dubai that was purchasing millions of dollars of computers from U.S. companies for export to Iran, through Dubai. ICE-HSI agents arrested one of the company’s agents, who pleaded guilty in December 2010 and began cooperating with the government. In interviews with agents, this individual indicated that he and his company in Dubai had purchased millions worth of laptops from Shih in recent years for shipment to Iran, averaging $700,000 worth of computers each month. The affidavit alleges that agents also obtained documents indicating that more than 1,000 computers had been shipped by Shih’s company to Dubai and later to Iran, between April 9, 2010, and May 28, 2010, alone.
In February 2011, the cooperating individual met with Shih in New York. In recorded conversations, Shih allegedly told the individual he was aware of the U.S. embargo against Iran and U.S. export control laws. According to the affidavit, Shih also told the cooperating individual how to avoid detection when shipping goods to Iran by using fake invoices and indicated that he treated the seizure of some of his shipments as a “loss” when reporting business income and loses on his U.S. taxes.
The affidavit filed in support of the complaint against Habibion and Motamedian alleges that a company in Dubai, referenced above, purchased millions of dollars worth of laptop computers from Online Micro and that these computers were subsequently shipped to Iran. According to the affidavit, the agent for the Dubai company, who was arrested, pleaded guilty and began cooperating with the government, told federal agents that Habibion and Motamedian sold roughly $300,000 worth of computers to the Dubai company each month and that Habibion and Motamedian fully understood that the computers were destined for Iran.
In December 2010, the cooperating individual met with Habibion and Motamedian, wherein these defendants allegedly instructed the cooperating individual to make fake invoices to conceal that Iran was the destination of the shipments and to indicate that the end-users were in Dubai.
In addition, the affidavit alleges that in a Jan. 5, 2011, meeting, Habibion told the cooperating individual to lie to federal agents about conducting business in Iran, stating, “If they ask you, for instance, ‘Do you do business in Tehran?’ ‘No, I don't have any business in Tehran. I go there to visit my family, but I have no business there.’ They will ask such questions, it is part of their routine.”
ANOTHER VERSION
WASHINGTON – Three U.S. citizens and their two companies were indicted on Thursday for illegally exporting millions of dollars worth of computers to Iran via the United Arab Emirates, the Justice Department said.
It said Jeng Shih, 53, and his New York company, Sunrise Technologies and Trading Company, were charged with 27 counts over exports of the equipment without obtaining the required Treasury Department licenses.
Massoud Habibion, 48, and Mohsen Motamedian, 43, and their firm in Costa Mesa, California, Online Micro LLC, also were indicted in federal court in Washington, D.C., on 32 counts for illegal exports, conspiracy, false statements and obstructing justice.
As part of the investigation, U.S. government agents identified a company in Dubai that had purchased computers worth millions of dollars from U.S. companies for export to Iran, through Dubai, Justice Department officials said.
They said one of the Dubai company's employees, who was not identified, pleaded guilty in U.S. court and began cooperating in the investigation.
The employee said laptops worth millions of dollars had been purchased from Shih for shipment to Iran, averaging $700,000 worth of computers each month, the officials said.
Federal agents also obtained documents that more than 1,000 computers had been shipped by Shih's company to Dubai and later to Iran just in April and May last year.
In February, the employee met with Shih in New York and recorded conversations in which Shih allegedly said how he used fake invoices on shipments to Iran, the officials said.
They said the Dubai company also bought laptops worth millions of dollars from the California firm for shipment to Iran.
The employee said Habibion and Motamedian sold about $300,000 worth of computers to the Dubai company each month and knew that the computers were going to Iran.
At a January 5 meeting, Habibion allegedly told the employee to lie to federal agents about doing business in Iran, urging him to say, "I go there to visit my family, but I have no business there," according to court documents.
Alan note: There are reportedly other "players" in this activity and possibly a South America transit point.
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Iranian man accused of illegal metal exports
By Nedra Pickler
February 1, 2011
WASHINGTON — U.S. authorities announced Tuesday that they have charged an Iranian businessman who they say acted as a "lifeline" to his country's missile program by smuggling metals and other vital materials from the United States in violation of a trade embargo.
The Justice Department said 36-year-old Milad Jafari is at large and believed to be in Iran. He was secretly charged with conspiracy, illegal export and smuggling last July and the 11-count indictment was unsealed Tuesday.
Federal officials said Jafari ran businesses in Istanbul and Tehran that would buy metals like steel and aluminum alloy from U.S. companies and export them through Turkey to hide their true destination, since exports to Iran are prohibited without authorization from the Treasury Department. The Treasury Department said that between 2007 and late 2008, Jafari's network facilitated more than $7 million in transactions for subordinates of Iran's Aerospace Industries Organization.
The Treasury Department described a family procurement business run by Jafari; his father Mohammad Javad Jafari; and brother, Mani Jafari; with his mother, Mahin Falsafi, handling the network's bank accounts. Jafari's Turkish associates, Muammer Kuntay Duransoy and Cagri Duransoy, helped with the transactions, Treasury said.
The Treasury Department on Tuesday designated the six individuals and five companies in the Jafari network as proliferators of weapons of mass destruction which freezes their assets in the United States in an attempt to isolate them from doing further business in this country.
"The Jafari network has established itself as a lifeline for Iran's missile program by providing essential materials and support for AIO," said Stuart Levey, Treasury's undersecretary for terrorism and financial intelligence.
The indictment alleged that in July 2006 Sanam Industrial Group, a subordinate of the AIO that has been sanctioned by the United States and United Nations for involvement in nuclear and ballistic missile activities, had requested that Jafari's company get a quote for 660 pounds of specialized steel welding wire. Less than a year later, Jafari's company paid a Nevada company $38,000 for that exact order while assuring the company that the wire would not be exported from Turkey or used for nuclear or ballistic weapons-related applications, the indictment said.
The charging documents also said that in 2007, Jafari's company ordered 4,410 pounds of high-grade, temperature-resistant stainless steel used in aerospace applications from an Ohio company, assuring the seller that it would not be shipped to Iran. The indictment said that a year earlier, Heavy Metals Industries in Iran placed an order with Jafari's company for 3,410 pounds of precipitation hardening steel.
Both shipments were detained by the Department of Commerce's Office of Export Enforcement before they left the United States.
But the indictment said Jafari and his associates were able to get several other shipments of other materials to Iran via Turkey. Those shipments included 1,366 pounds of commercial bronze bars from Texas, electronic testing equipment from Illinois and 6.6 pounds of custom-made brazing alloy from a California company. The indictment also noted that Jafari arranged to export fiber-optic equipment from Pennsylvania and aerosol generators from Minnesota.
The indictment sought forfeiture of $177,867.92 in connection with Jafari's alleged crimes
"Shutting down the illegal acquisition of material destined for use in weapons programs is among the highest priorities in the FBI," said Sean Joyce, executive assistant director of the FBI's National Security Branch that investigated the case. "We'll continue to pursue illegal acquisition efforts and protect our nation from the grave threat these WMD-related activities pose to our national security."
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