Smuggling of US tech said to be outpacing Cold War levels

WASHINGTON • Foreign smugglers are trying to ship US technologies, which can be used for weapons and spy equipment, to China, Russia and other adversaries at rates that outpace shadowy and illegal exports during the Cold War, according to US officials and experts.

In one recent case, a Texas businessman was paid US$1.5 million (S$2 million) to buy special radiation-resistant circuits for space programmes in Russia and China. The businessman, Peter Zuccarelli, was working with a smuggling ring run by a Pakistani-born American citizen; court documents show Zuccarelli created fake shipping documents and mislabelled the circuits as parts for touchscreen computers. He was sentenced in January to four years in prison.

In another case, Chinese citizen Sun Fuyi sought to buy M60 carbon fibre, which is used in military drones, from undercover federal agents at Homeland Security Investigations. Sun took steps to conceal and export US$25,000 worth of the material he bought shortly before he was arrested. He was sentenced in September last year to three years in prison.

"He openly claimed in an e-mail that he was closely associated with the military," said Mr Pete Gizas, a special agent with Homeland Security Investigations, a branch of US Immigration and Customs Enforcement.

Since 2013, nearly 3,000 people have been swept up by Homeland Security Investigations alone for trying to smuggle weapons and sensitive technologies - including circuits or other products that can be used in ballistic missiles, drones or explosive devices.

In that time, according to documents from the Department of Homeland Security, federal agents also seized more than 7,000 items, including microchips and jet engine parts, set to be smuggled out. Exporting such items is tightly controlled by the US government to prevent hostile nations or terrorist organisations from turning them into weapons or devices that could harm the United States.

Russia, China, North Korea and Iran are some of the countries most active in trying to illegally acquire US military technology, according to American officials.

The scale of current efforts is unusual and "worse than anything that occurred during the Cold War", said Mr Robert Litwak, vice-president for scholars and director of international security studies at the Wilson Centre in Washington.

The rise is connected to an increase in foreign hackers who are infiltrating the US defence industry and technology companies to steal blueprints for weapons and sensitive technology.

"So they can sit in Iran or North Korea, out of reach of US authorities, and just take what they need without trying to smuggle the item out of the country or getting someone to steal it," said Mr Patrick McElwain, who runs a special export enforcement unit at Homeland Security Investigations.

Officials at the Chinese Defence Ministry could not be reached for comment.

The Russian Defence Ministry declined to comment. But Mr Ruslan Pukhov, director of the Centre for Analysis of Strategies and Technologies, Russia's leading think-tank for the defence industry and arms trade, said claims of an increase in Russian attempts to steal US military technologies were overblown.


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A version of this article appeared in the print edition of The Straits Times on March 19, 2018, with the headline Smuggling of US tech said to be outpacing Cold War levels. Subscribe