On May 18, 2007, a New York man named Ping Cheng flew to the Twin Cities on a business trip. He had been dispatched by a Singapore company to check out its latest purchase: 104 kilograms of a carbon fiber material called Toray M60. Because Toray carbon fiber can be used for aircraft, rockets, satellites and uranium enrichment, the federal government doesn’t want it to get into the hands of the wrong people. So you need a permit to export it. Cheng and two other men planned to export the Toray M60 to Singapore, after trucking it from Minnesota to New York City and claiming, illegally, that the material didn’t need a permit.

Federal court documents tell how this little-known chapter of international intrigue unraveled: Cheng’s visit to an Eagan warehouse to inspect the material, and a subsequent visit in July 2007 to look at an additional 211 kilograms of material bound for Hong Kong, were all part of sting by two federal agencies, Immigration and Customs Enforcement and the Bureau of Industry and Security of the U.S. Commerce Department. The Minnesota carbon fiber dealer, identified only as “Company A” in court documents, was a front set up by federal investigators. The feds went along with the “deal” up to the point in spring 2008 when the material was about to be shipped overseas.

Cheng and two others were indicted in October, and those indictments were highlighted in a U.S. Justice Department announcement of a crackdown on “illegal exports of restricted military and dual-use technology,” 43 percent of which were headed for China or Iran.

This week, Jian Wei Ding, 50, of Singapore pleaded guilty in federal court in Minneapolis to violate federal export laws in connection with the carbon fiber deal. According to a news release from U.S. Attorney Frank Magill:

“Ding exercised control over several Singaporean import/export companies, one of which was in the business of acquiring high-technology items for its customers. One of those customers is the China Academy of Space Technology, which oversees research institutes working on spacecraft systems for the People’s Republic of China.”

Ding’s plea followed the guilty pleas of Kok Tong Lim, 36, of Singapore, and Ping Cheng, 46, of Manhasset, N.Y. The men face up to 20 years in prison and a maximum fine of $1 million, although their plea agreements indicate that the guidelines will be closer to 46-57 months for Ding and Cheng, 37-46 months for Lim. The government also gets to keep the Toray carbon fiber, for which Ding’s company, FirmSpace PTE Ltd, paid $300,000.

This entry was posted on Wednesday, March 25th, 2009 at 11:35 am and is filed under Businesses in hot water. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.