September 16, 2016
By Daniel Calloway, SanctionsAlert.com
On April 4, 2016, Lim Yong Nam (also known as Steven Lim), a citizen of Singapore, was extradited from Indonesia to the US to stand trial on charges of taking part in a conspiracy involving the export of 6,000 radio frequency modules, from the US to Iran.
A radio frequency module is equipment used to transmit signals between two devices, and a classic example of a so-called dual-use item, which can be innocent, or can have military applications, such as use in an explosive device. In some cases, dual use items cannot be exported without permission from the Department of Commerce.
Overview of the case
Lim’s overall case is a layered one, the origin of which dates back to 2010. It was during this year that prosecutors in Washington, DC unsealed the superseding indictment which contained charges of conspiracy for the illegal export of goods to Iran, smuggling, conspiracy to defraud the United States, false statements to the US government, and obstruction of justice.
Lim was one of many defendants: (1) Hossein Larijani (Iranian National) and his associated companies Paya Electronics Complex (based in Iran), and Opto Electronics Pte., Ltd. (based in Singapore); (2) Wong Yuh Lan (Singapore National and agent of Opto Electronics); (3) Lim Kow Seng and Hia Soo Gan Benson (both Singapore Nationals) and their respective company Corezing International Pte Ltd. (based in Singapore); and (4) Lim Yong Nam’s corporate entity NEL Electronics Pte. Ltd., (based in Singapore).
The superseding indictment, which is merely a formal charge that a defendant has committed a violation of criminal law and is not evidence of guilt, was replete with allegations of a network created by the defendants to export the radio frequency modules, which can have military application, to Iran, a country subject to sanctions.
The extradition was a lengthy process as Lim had fought the request and was subsequently detained in Indonesia since October 2014.
Showcase example of diverting military-capable materials to unauthorized end-user
The indictment says that between June 2007 and February 2008, Lim and the others purchased 5 shipments of radio frequency modules from a Minnesota-based company by falsifying documents that stated the devices would stay in Singapore for a telecommunications project. According to the indictment though, the modules would arrive in Singapore and then be forwarded to Iran by airfreight through third countries with the ultimate recipient being an Iranian national, Mr. Larijani, another defendant in this case. The government says that the defendants defrauded the US company and the government in a myriad of ways in an effort to circumvent the US sanctions laws and get these military-capable materials to their destination point in Iran.
The Bureau of Industry and Security (BIS) of the US Department of Commerce is responsible for regulating the export of so called dual-use items such as radio frequency modules, which can have both commercial and military applications. Dual use export licenses for these products are required in certain situations involving national security, foreign policy, nuclear non-proliferation, and other concerns. The license requirements are dependent upon an item’s technical characteristics, the destination, the end-use, and the end-user, and other activities of the end-user.
The list of dual-use technologies includes many products that appear innocent. A good example is carbon fibers, the materials of tennis rackets and golf clubs. Carbon fibers are on the dual use list because they are also ideal for the nose cones of intercontinental ballistic missiles, because they resist the heat of re-entry through the atmosphere.
In an effort to assist companies to comply with complex export rules involving dual use goods, BIS published a set of “best practices” in 2011. In particular, the document helps guard against the diversion of dual-use items shipped to a transshipment “hub,” or to any intermediate country before being shipped to the country of ultimate destination, which allegedly happened in the case of Mr. Lim.
The ramifications of evading sanctions controls, and thus the importance of this case, cannot be understated. If the length of this investigation is any indicator, from the original indictment of Lim and others in 2010 to the final extradition of Lim in 2016, the government is relentless in their pursuit of prosecuting crimes that threaten national security. The premiere allegation in the indictment, that in 2008 and 2009 coalition forces found at least 16 of the ill-gotten modules in unexploded IEDs in Iraq, is the reason that the investigation was a top priority for the US government and required a coordinated effort. The prosecution is led by Assistant US Attorney Ari Redbord of the District of Columbia and Trial Attorney Julie Edelstein of the National Security Divisions Counterintelligence and Export Control Section. The investigation itself was conducted by multiple agencies such as Department of Justice’s ICE and FBI, and Department of Commerce’s BIS.
Status of the case
With regard to the status of this case, Lim has consistently professed his innocence from the protest of his extradition to his plea of not guilty in 2016; he has yet to have his day in court. He is due for a status conference in October 2016, which is a hearing to inform the court as to how the case is proceeding, what discovery has been conducted, any settlement negotiations, probable length of trial, etc.
On the other hand, Seng and Benson, who were extradited separately, had their initial court appearance in the US in December of 2012. They pleaded guilty for their roles in the conspiracy to defraud the US and were sentenced on September 20, 2013, to 37 months and 34 months imprisonment.
The final alleged conspirator, Larijana is still at large.