DOJ links Iran, China and Russia to five IP theft-related cases

The Department of Justice (DOJ) charged multiple defendants in five separate cases of crimes ranging from export violations, smuggling of restricted technologies and one intellectual property case involving a former Apple employee accused of stealing source code and hardware tied to its autonomous vehicle system on the behalf of the People’s Republic of China.

The DOJ indictments were executed in partnership with its Disruptive Technology Strike Force, which was established in February. The strike force actions announced Tuesday span five separate U.S. Attorney’s offices resulted in four arrests.

The DOJ alleges that each of the cases are tied to nation-state actors separately representing Iran, China and Russia. In each of the cases the DOJ believes individuals attempted to “illicitly acquire sensitive U.S. technology to advance their authoritarian regimes and facilitate human rights abuses.”

The Disruptive Technology Strike Force is co-led by DOJ and the Commerce Department with the mission to counter hostile nation-states attempting to acquire sensitive U.S. technology. Tuesday's strike force inditements span export violations, smuggling and theft of trade secrets.

As detailed in a May 16 DOJ, two of the cases disrupted alleged procurement networks created to help the Russian military and intelligence services, while the three other cases involved China.

In one of the cases connected with Russia, a Greek national was arrested May 9 in Paris for crimes allegedly acquiring more than 10 types of sensitive technologies on behalf of the Russian government. Dr. Nikolaos Bogonikolos, 59, of Athens, was charged in the Eastern District of New York with wire fraud conspiracy and smuggling. 

Bogonikolos headed the Aratos Group, a collection of defense and technology companies in the Netherlands and Greece, which are both NATO countries. The complaint alleges that Bogonikolos has been involved in smuggling U.S. military and dual-use technologies to Russia since 2017 in violation of U.S. law, with items used for military applications such as quantum cryptography and nuclear weapons testing being reshipped to Russia and ending up at nuclear and quantum research facilities. 

In the District of Arizona, two Russian nationals were arrested for a scheme to supply Russian airlines with export-controlled parts and components, including braking technology. If convicted, the two men face up to 20 years in prison for violating the Export Control Reform Act, and up to 20 years for conspiring to commit international money laundering.

Two former software engineers were charged with stealing software and hardware source code from U.S. tech companies to sell to Chinese competitors. 

Liming Li, 64, was arrested May 6 in the Central District of California for allegedly stealing sensitive technologies from two Southern California-based employers — working at one from 1996 to 2018, and the other from 2018 to 2019 — to use them to market at a company in China.

The senior software engineer allegedly stole code used in metrology software used in “smart” automotive manufacturing equipment. The software programs Li is accused of stealing can be used to manufacture parts for nuclear submarines and military aircraft, which are subject to U.S. export controls for national security. If convicted, Li faces a maximum of 10 years in federal prison.

Ex-Apple employee flees US

In the Northern District of California, the federal court unsealed an indictment for Weibao Wang, 35, a former Apple employee who used to reside in Mountain View, California. Wang was charged with stealing thousands of documents of source code for software and hardware regarding Apple’s technology for autonomous systems, which include self-driving cars. 

After accepting an offer for employment for a U.S.-based subsidiary of a Chinese company, Wang waited four months before leaving Apple. After his departure from Apple in 2018, the company’s representatives reviewed Wang’s access logs and identified large amounts of sensitive proprietary and confidential information was accessed. 

Wang fled to China and is believed to be working with a China-based autonomous vehicle competitor, but faces a maximum sentence of 10 years in prison and a $250,000 fine for each of the six counts of theft or attempted theft of trade secrets.

The final case involved a Chinese citizen allegedly participating in a scheme to use his employer to conduct transactions with a U.S. financial institution for the benefit of an Iranian entity as part of an effort to provide isostatic graphite, a material used in the production of weapons of mass destruction.

The federal court in the Southern District of New York unsealed an indictment against Xiangjiang Qiao, aka Joe Hansen, 39, who was charged with sanctions evasion, money laundering and bank fraud offenses. The multiple charges against Qiao each carry 20 to 30 years in prison, if convicted. Qaio is at large in China. 

“Protecting sensitive American technology – like source code for ‘smart’ automotive manufacturing equipment or items used to develop quantum cryptography – from being illegally acquired by our adversaries is why we stood up the Disruptive Technology Strike Force,” said Matthew S. Axelrod, Assistant Secretary for Export Enforcement at the Department of Commerce in a media statement. “The Strike Force actions announced today reflect the core mission of our Export Enforcement team – keeping our country’s most sensitive technologies out of the world’s most dangerous hands.”