Los Angeles Resident Found Guilty of Conspiring to Illegally Export Semiconductor Chips to China

A Los Angeles resident was found guilty of conspiring to illegally export semiconductor chips to China, violating the International Emergency Economic Powers Act, the Department of Justice said in a July 2 press release. Yi-Chi Shih faces a maximum prison sentence of 219 years.

Shih illegally gained access to a “protected computer” of a U.S. company that makes “wide-band, high-power semiconductor chips," or “monolithic microwave integrated circuits (MMICs),” before exporting the chips, the press release said. The company's semiconductor chips are used by the U.S. military for dual-use items, including missiles and fighter jets, DOJ said.

As part of the scheme, Shih accessed the company’s computer systems with a co-conspirator by “posing as a domestic customer” who was looking to buy “custom-designed MMICs” that would be used only in the U.S., DOJ said. However, after obtaining the MMICs, Shih illegally exported the circuits to China without the proper license from the Commerce Department, the press release said.

Shih shipped the chips to Chengdu GaStone Technology Company (CGTC), which was building a MMIC manufacturing company in China, the press release said. Shih previously served as the president of CGTC, which was added to Commerce’s Entity List in 2014, DOJ said, due to the “illicit procurement of commodities and items for unauthorized military end use in China.”

Shih used his Hollywood Hills-based company Pullman Lane Productions LLC “to funnel funds provided by Chinese entities to finance the manufacturing of MMICs by the victim company,” the press release said. Pullman Lane was funded by a Beijing company that was also placed on Commerce’s Entity List.

Along with violating the IEEPA, Shih was also found guilty of mail fraud, wire fraud, subscribing to a false tax return, making false statements to a government agency and conspiracy to gain unauthorized access to a protected computer to obtain information. Shih’s co-conspirator Kiet Ahn Mai, pleaded guilty to one count of smuggling and faces a maximum prison sentence of 10 years at sentencing in September. A court is still deciding on forfeiture allegations in Shih’s indictment that could force Shih to surrender “hundreds of thousands of dollars.”

“The FBI is committed to protecting institutions from adversaries who seek to steal sensitive American technology under the guise of research,” Assistant Director in Charge Paul Delacourt of the FBI’s Los Angeles Field Office said in a statement. “We will continue to work collaboratively with our federal partners to identify and hold accountable individuals who plunder our research or intellectual property at the expense of the American people and our national security.”