(The following is a reformatted version of a press release
issued by The U.S. Justice Department and received via
electronic mail. The release was confirmed by the sender.) 
DECEMBER 20, 2012 
Defendant Also Ordered to Pay a $100,000 Fine, Perform Community
WASHINGTON - Xun Wang, a former managing director of PPG Paints
Trading (Shanghai) Co., Ltd., a wholly-owned Chinese subsidiary
of United States-based PPG Industries, Inc., was sentenced today
to a year in prison for conspiring to violate the International
Emergency Economic Powers Act. 
The sentence was announced by Ronald C. Machen Jr., U.S.
Attorney for the District of Columbia, and Eric L. Hirschhorn,
U.S. Department of Commerce Under Secretary for Industry and
Wang, 52, was sentenced by the Honorable Emmet G. Sullivan of
the U.S. District Court for the District of Columbia. In
addition to the prison time, Judge Sullivan ordered Wang to pay
a $100,000 fine and to perform 500 hours of community service. 
Wang pleded guilty to the conspiracy in November 2011, and
agreed, as part of her plea, to cooperate with the government’s
investigation.  Her cooperation led to the Dec. 3, 2012, guilty
plea by the China Nuclear Industry Huaxing Construction Co.,
Ltd. That plea is believed to have marked the first time that a
People’s Republic of China corporate entity has entered a plea
of guilty in a U.S. criminal export matter. As part of its plea
agreement, Huaxing agreed to the maximum criminal fine of $2
million, $1 million of which will be stayed pending its
successful completion of five years of corporate probation. 
“Xun Wang was the most senior PPG Paints Trading
corporate executive involved in this unlawful export scheme,”
said U.S. Attorney Machen. “This prosecution has already held
corporations accountable for their violations of U.S. export
laws, but today’s prison sentence shows our determination to
hold corporate executives personally responsible when they
compromise our nation’s security in the pursuit of corporate
The investigation was led by the Department of
Commerce’s Bureau of Industry and Security (BIS). In November
2011, Wang also settled an administrative proceeding brought by
the Department of Commerce regarding the same subject matter as
her criminal case.  As part of her settlement agreement, Wang
has agreed to pay a civil penalty of $200,000 with another
$50,000 payment suspended, and to be placed on the Department of
Commerce’s Denied Persons’ list for a period of five years with
an additional five years suspended.  As a denied person, Wang
will be prohibited from directly or indirectly participating in
any transaction involving a commodity, software or technology
exported, or to be exported, from the United States that is
subject to Department of Commerce regulations. 
“This case clearly demonstrates our resolve to hold
individuals responsible for violations of our export control
laws,” said Under Secretary Hirschhorn. “Individuals can no
longer hide behind a corporate veil.  BIS Special Agents will
continue to leverage our unique authorities to pursue violators
anywhere in the world.” 
In both the criminal and administrative cases, Wang is
accused of conspiring to export. reexport, and transship high-performance epoxy coatings to the Chashma II Nuclear Power Plant
in Pakistan, a nuclear reactor owned and/or operated by the
Pakistan Atomic Energy Commission, an entity on the Department
of Commerce’s Entity List. 
The Pakistan Atomic Energy Commission is the science and
technology organization in Pakistan responsible for Pakistan’s
nuclear program, including the development and operation of
nuclear power plants in Pakistan. In November 1998, following
Pakistan’s first successful detonation of a nuclear device, the
Commerce Department’s Bureau of Industry and Security added the
Pakistan Atomic Energy Commission, as well as its subordinate
nuclear reactors and power plants, to the list of prohibited end
users under the Export Administration Regulations. 
As a restricted end-user, a United States manufacturer
seeking to export, reexport or transship any items subject to
the Export Administration Regulations to the Pakistan Atomic
Energy Commission, or its nuclear power plants or reactors,
would first need to obtain a license from the Department of
Commerce in the District of Columbia. 
Wang’s conviction is related to the Dec. 21, 2010,
guilty plea of PPG Paints Trading to a four-count information in
the U.S. District Court for the District of Columbia.  Together,
PPG Paints Trading and its parent company, PPG Industries, paid
$3.75 million in criminal and administrative fines and more than
$32,000 in restitution. The combined amount of criminal and
civil fines represented one of the largest monetary penalties
for export violations in the history of the Bureau of Industry
and Security. 
According to Wang’s plea documents, in January 2006, PPG
Industries sought an export license for the shipments of
coatings to Chashma II.  In June 2006, the Department of
Commerce denied that license application.  Following that
denial, Wang and her co-conspirators agreed upon a scheme to
export, reexport and transship PPG Industries’ high-performance
epoxy coatings from the United States to Chashma II, via a
third-party distributor in People’s Republic of China, without
first having obtained the required export license from the
Department of Commerce. 
The plea documents further allege that from around June
2006 through around March 2007, Wang and her co-conspirators
intentionally concealed from PPG Industries that the coatings
would continue to be delivered to Chashma II.  Further, members
of the conspiracy stated, or caused to be stated, that the
coatings were to be used at a nuclear power plant in China, the
export of goods to which did not require a license from the
Department of Commerce. Through these means, Wang and her co-conspirators allegedly exported three shipments of coatings from
the United States to Chashma II without the required Commerce
Department license. 
In announcing the sentence, U.S. Attorney Machen and
Under Secretary Hirschhorn commended Special Agents James Fuller
and Donald Pearce, who worked under the direction of Special
Agent in Charge Sidney M. Simon and Assistant Special Agent in
Charge Jonathan Carson, as well as Attorney Advisor R. Elizabeth
Abraham, all of the Department of Commerce’s Bureau of Industry
and Security.  They also thanked Assistant U.S. Attorney G.
Michael Harvey of the U.S. Attorney’s Office for the District of
Columbia, who prosecuted this matter. 
(202) 252-6933
(bjh) NY 
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