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Peace at any cost is a Prelude to War!
Beijing illegally bought circuits
By Bill Gertz
THE WASHINGTON TIMES
Federal authorities have uncovered a major Chinese technology transfer
program that illegally purchased thousands of U.S. radiation-protected
computer chips for use in Chinese missiles and satellites.
The military-related technology-buying program was revealed in court
papers released in Orlando, Fla., earlier this month after a raid on a
Chinese company involved in selling "radiation-hardened" integrated circuits
to Chinese government missile and satellite manufacturers, including several
that were sanctioned in the past by the U.S. government for their missile
sales.
The company, Means Come Enterprises Inc., is under investigation for
"illegally exporting radiation-hardened integrated circuits to [the People�s
Republic of China] without the required [Commerce Department] export
licenses," according to documents obtained by The Washington Times.
Three illegal diversions of the missile microchips by Means Come are
described in a 27-page affidavit produced by the Commerce Department�s Office
of Export Enforcement before a search of the company�s Orlando offices.
Commerce Department, U.S. Customs Service and Postal Service agents
raided the Orlando offices of Means Come on May 3, seizing computers and
documents related to the microchip transfers.
Officials of the company, which has offices in Orlando, Beijing, Hong
Kong and Montreal, could not be reached for comment. Jim Hoyos, a Commerce
Department export control investigator involved in the case, also declined to
comment. "It�s an ongoing investigation," he said.
The illegal diversion of U.S.-made radiation-hardened computer chips to
China was first reported in The Washington Times on Jan. 26.
The raid on the Orlando company took place the same day FBI agents
arrested two Chinese nationals and a third man for stealing Lucent
Technologies software codes and selling them to China.
According to Commerce export agent Roy A. Gilfix, who wrote the
affidavit in support of a federal search warrant, Means Come sold China 2,316
embargoed integrated circuits in shipments in February, May and November
1998.The chips were made by Harris Semiconductor, a Melbourne, Fla.,
subsidiary of the Harris Corp.
According to the affidavit, the radiation-hardened chips are used in
missiles and require export licenses before being sold abroad.
Means Come Enterprises made its first export license application in
March 1997, saying it wanted to buy 7,200 radiation-protected chips for the
Chinese Academy of Space Technology (CAST) for use in a satellite project,
the affidavit states.
The license was turned down in June 1997 because the sale posed "an
unacceptable risk" that the Chinese government-run academy would use the
circuits "in missile proliferation activities," the affidavit said.
CAST and several other Chinese firms were sanctioned by the U.S.
government in 1993 for selling M-11 missiles to Pakistan in violation of U.S.
arms proliferation laws.
A month after the export license was rejected, Kao Ahwan, a Chinese
national, and her husband, Kao Shuli, opened the Orlando office of Means Come
and bought the 7,200 Harris computer chips from Atel Electronics Corp. in New
York. Means Come paid $679,000 for the chips, which were sold by Atel for use
only in the United States.
However, Means Come exported the circuits without a license in three
shipments in 1998, the affidavit states. "Means Come Enterprises� customer,
the Great Wall Industry Import and Export, is a state-owned corporation in
China�s defense aerospace industry," the document said. "It develops
strategic and tactical ballistic missiles, space launch vehicles,
surface-to-air missiles, cruise missiles, military reconnaissance and
communication mission and civilian satellites."
Great Wall Industry also was sanctioned in the past for its sales of
missiles to Pakistan, Iran and Iraq.
In October 1998, Means Come officials in Florida were questioned about
the circuit exports and other weapons-related technology sales. One company
executive, Francis Chan, was questioned by Commerce export control agents and
told them the company recently sought to purchase "U.S.-origin nuclear
electronics for export to the PRC."
The parts were to be transferred to the China National Aero-Technology
Import & Export Corp., known as CATIC, the affidavit said, but the sale never
took place after Mr. Chan learned it required a U.S. export license.
CATIC was indicted in 1999 for illegally diverting U.S. aircraft
manufacturing machine tools to a military plant. On May 11, it agreed to pay
$1.3 million in fines for using McDonnell Douglas aircraft machine tools
meant for commercial purposes to make Silkworm anti-ship missiles.
The company also brought officials from China�s state-run China
Aerospace Corp. to the United States for inspections of technical equipment
at its Orlando offices. The affidavit states that China Aerospace
"specializes in various space products, such as satellites, missiles, launch
vehicles and ground support systems."
Gary Milhollin, weapons proliferation specialist and director of the
Wisconsin Project on Nuclear Arms Control, said the chips have military
applications and could be used by the Chinese military to "improve their
ability to target U.S. cities with long-range missiles."
Mr. Milhollin said the Bush administration should reverse the Clinton
administration policy of "looking the other way and refusing to put Chinese
companies like the Chinese Academy of Space Technology, CATIC, and China
Aerospace Corp. on a special government watch list."
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any copyrighted work in this message is distributed under fair use
without profit or payment to those who have expressed a prior interest
in receiving the included information for nonprofit research and educational
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