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California couple charged with exporting sensitive technology to China

by Michael Martinez, CNN
STORY HIGHLIGHTS
  • NEW: Couple tried to cover up conspiracy when questioned by investigators
  • NEW: Couple allegedly failed to secure required export license
  • Allegations deal with the export of high-performance analog-to-digital converters
  • The technology has military uses and is restricted for anti-terrorism reasons

Los Angeles, Calif. -- A southern California couple who ran a technology company has been arrested on charges of conspiring to export sensitive technology illegally to China and for making false statements to investigators, a spokesman for the U.S. attorney said Friday.

York Yuan Chang, 53, also known as David Zhang, was ordered held without bond Friday. His wife, Leping Huang, 49, was released Thursday after posting part of a $1 million bond, the U.S. attorney's office said.

The Diamond Bar, California, couple was arrested at their home Monday. He's a naturalized U.S. citizen, and she's a Chinese national, authorities said.

The couple's firm, General Technology Systems Integration Inc., of Ontario, California, contracted with the Sichuan Institute of Solid-State Circuits -- also known as the 24th Research Institute of the China Electronics Technology Corporation Group -- in Chongqing to design and transfer technology for two types of high-performance analog-to-digital converters without the required license, authorities said.

That technology has military and commercial applications, and it has export controls because of national security and anti-terrorism reasons, authorities said.

Any sale of the converters or their technology to China requires an export license.

Authorities allege that the couple hired two engineers to design the technology in early 2009 and sent them to China to provide training to engineers there. When the American engineers returned home, U.S. Customs and Border Protection personnel inspected their computer files and documents and found evidence of an illegal technology transfer, authorities charge.

The couple then sought to conceal the project when they were contacted by federal investigators, prosecutors allege.

The export conspiracy count against the couple carries a maximum prison sentence of 20 years. The husband is charged with one count of making a false statement and his wife faces two such counts. Each count carries a maximum sentence of five years in prison.

"Zhang and Huang never applied or intended to apply for an export license as required under United States export law and regulations, despite their knowledge that such a license was required. When questioned by federal agents about the (analog-to-digital) project, they falsely stated, among other things, that the project had been cancelled in early 2009," said FBI special agent Michael N. Damascus in an affidavit filed with court papers.