Professor convicted of smuggling microchips to China faces 219 years in prison

Humza

TechSpot Staff
Staff member

The US Justice Department announced a sentence of 219 years for Yi Chi Shih, a Chinese-American electrical engineer and adjunct professor at UCLA for illegally exporting microchips to China. The federal court in its six-week trial found Shih guilty on 18 counts, including mail and wire fraud, fabricated tax returns, falsifying statements to a government agency, conspiring to gain unauthorized access to a protected computer and violating the International Emergency Economic Powers Act, a federal law that bars unauthorized exports in light of an "unusual and extraordinary threat [...] to the national security, foreign policy, or economy of the United States."

64 year old Yi Chi Shih and his co-defendant Kiet Ahn Mai, 65, reportedly gained access to a protected computer owned by a US manufacturer of semiconductor chips known as monolithic microwave integrated circuits (MMICs) through the company's web portal. Mai posed as a "domestic customer" for the microchips that were meant to be used in the US only, notes the Justice Department, adding that Shih and Mai concealed the former's intention of sending the microchips to Chengdu GaStone Technology Company in China.

Shih was required to get a license from the Commerce Department for exporting the MMICs to China, which the Justice Department says was never sought or obtained. Shih also had previously been a president at CGTC, which was placed on the Commerce Department's Entity List in 2014 "due to its involvement in activities contrary to the national security and foreign policy interest of the United States – specifically, that it had been involved in the illicit procurement of commodities and items for unauthorized military end use in China."

The court observed that these chips can be used in various military applications like "missiles, missile guidance systems, fighter jets, electronic warfare, electronic warfare countermeasures and radar applications," with the undisclosed American company having commercial and military customers including the Air Force, Navy and the Defense Advanced Research Projects Agency.

Shih funded the scheme through his US based company Pullman Lane Productions LLC, which he used "to funnel funds provided by Chinese entities to finance the manufacturing of MMICs by the victim company." A Beijing-based company, which incidentally was placed on the Entity List the same day as CGTC, was used to finance Shih's company.

James Spertus, Shih's lawyer, reportedly said that Shih never sent the microchips to China but had designed them himself for an academic research project, expressing that the government turned the legitimate research of the professor into a conspiracy about Chinese military trying to steal US technology.

“This defendant schemed to export to China semiconductors with military and civilian uses, then he lied about it to federal authorities and failed to report income generated by the scheme on his tax returns,” said United States Attorney Nick Hanna.

John Demers, the Assistant Attorney for National Security, thanked the Royal Canadian Mounted Police for their help in the investigation and prosecution of the case. The Canadians were reportedly asked by US authorities to search the lab of Shih's brother, Ishiang, an associate engineering professor at McGill University in Montreal who had previously collaborated with his brother on numerous scientific projects.

Indicted in the case in January 2018, Shih's co-defendant Mai pleaded guilty in December 2018 "to one felony count of smuggling and is scheduled to be sentenced on September 19, at which time he will face a statutory maximum sentence of 10 years in federal prison," with the District Judge John A. Kronstadt to schedule a sentence hearing for Shih who faces "statutory maximum sentence of 219 years in federal prison."

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psycros

TS Evangelist
Over 30% of all Chinese foreign nationals working in the US tech industry have either already been linked to intellectual property theft or are currently under investigation. Their all connected either directly or covertly to red chip companies who are rewarded by the PRC for stealing western tech secrets. This particular spy was obviously a highly placed sleeper agent who has probably been funneling info to Beijing for years - same goes for his brother. Despite the fact he had been the PRESIDENT of a company known for IP theft he was kept on as as professor at a major university, but then again this is UC we're talking about. When the export crackdown came into effect he clearly realized the gravy train was about to run dry and attempted to pull off a big score. You'd think by now that the US tech giants and public institutions would realize their cutting their own throats by giving hiring preference to H1B serfs from Asia while there are plenty of candidates from this hemisphere available.
 

Justic

TS Rookie
Actual details on the case, rather than copying word by word the released statement from the Trump-captured justice system.

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... Spertus said the company that the Justice Department declined to identify was Cree Inc, a foundry in Durham, North Carolina, that makes prototypes. Shih designed a chip and sent it to Cree to see if his design worked, the lawyer said.

The so-called computer portal Shih accessed is a drop box that Cree customers use, Spertus said. “This was a railroad effort by the government to send a strong message back to China,” the lawyer said. “Shih got caught in a trade war he had nothing to do with.”

... But Spertus said the semiconductors in question were part of Shih’s research and were not sent to China. One of Shih’s students may have taken a chip back to China as part of a research project and an export license was not required, the lawyer said.

The US government was never clear what basis it had for its allegation that computer wafers were sent to China, Spertus said. Shih was president of CGTC but left before the company was put on the Entity List, Spertus said.

“This was not justice,” he added. “This trial is beyond anything I’ve seen in my life. There was so much prejudice.”

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So you got a professor facing 219 years in jail accessing a chip that they designed themselves. The chip was uploaded by themselves to a foundry to check if it works.

"these chips can be used in various military applications" Almost all chips have potential military application. This professor never

There is no justice. The court system is a complete joke. News media also a complete joke. No one is trying to find facts. The mangled words of the prosecution is taken as the truth. Every single American based news media is severely biased against the Chinese American scientist. This is an actual witch hunt.