Chinese national pleads guilty to trying to export military satellite gear to China

A 29-year-old citizen of the People’s Republic of China pleaded guilty in federal court in Salt Lake City to violating the Arms Export Control Act after attempting to illegally procure military-grade satellite communications equipment for export to China, according to the Department of Justice.

Dingwei Chen entered his guilty plea before U.S. District Judge David Sam, who accepted the plea and scheduled sentencing for Oct. 19, the Justice Department said. Chen faces a maximum penalty of 20 years in prison.

Prosecutors said Chen attempted to purchase military-grade satellite modems and radios manufactured for the U.S. military by American companies. The specific communications hardware may not legally be exported from the United States without a license from the State Department’s Directorate of Defense Trade Controls, which generally does not issue licenses for military exports to China, according to the release.

“Chen tried to divert sensitive U.S. military technologies to the People’s Republic of China, technologies the PRC could have used against us in the future,” said John A. Eisenberg, assistant attorney general for national security. He said the National Security Division would continue working with government partners to enforce U.S. laws and protect the military advantage provided by such technologies.

Acting Special Agent in Charge Spiros Karabinas of Homeland Security Investigations New Jersey said the guilty plea underscores “the serious consequences” for those who attempt to illegally procure, export or transfer sensitive U.S. military technology. He credited collaboration between HSI offices and the Defense Criminal Investigative Service with disrupting the illicit procurement network.

DCIS Director James R. Ives said advanced communications systems are essential to protecting American warfighters and vowed that his agency would “aggressively pursue” those attempting to obtain and illegally export sensitive technology that could pose future risks to U.S. troops.

According to court records cited by the Justice Department, Chen worked with others in China to acquire the communications systems from foreign arms dealers on the black market. The group discussed multiple smuggling routes, first considering transshipment through Switzerland, then pickup in Saipan, before settling on a plan to smuggle the equipment through Mexico.

After an initial down payment exceeding $40,000, Chen and his associates shifted to cryptocurrency, noting that “cold wallets are essentially anonymous bank accounts” and that each transaction processed through them was “private and untraceable,” prosecutors said. They ultimately paid roughly $30,000 in USDT toward the purchase of 10 modems and communicated through an encrypted app to avoid detection. Court records state that Chen claimed the transaction was merely an initial deal and that he had funding to acquire tens of millions of dollars’ worth of additional military equipment.

Eisenberg thanked the HSI and DCIS agents who investigated the case.

The case is being prosecuted by Trial Attorney Christopher Magnani of the National Security Division’s Counterintelligence and Export Control Section, the Justice Department said.