A suburban Chicago man pleaded not guilty to charges he and his father conspired to evade federal regulations blocking access to the U.S. financial system by people seeking to spread weapons of mass destruction.
Yueh-Hsun “Gary” Tsai of Glenview, Illinois, entered his plea today before U.S. District Judge Charles R. Norgle in Chicago. He and his father, Hsien Tai Tsai, also known as Alex, were indicted by a federal grand jury earlier this month.
The U.S. has linked the elder Tsai to “the supply of weapons machinery to North Korea,” acting Chicago U.S. Attorney Gary S. Shapiro said in a May 6 statement announcing the arrest of both men.
Alex Tsai of Taiwan, whose access to the U.S. banking system was blocked by the Treasury Department in January 2009, was arrested May 1 in Estonia and is awaiting extradition.
Gary Tsai’s plea was entered for him by defense attorney Theodore Poulos.
U.S. Magistrate Judge Susan Cox last month conditioned his release upon the posting of a $500,000 bond backed by the Glenview home he shares with his wife and about $90,000 to be deposited with the court. Today, Norgle left those requirements in place.
Alex Tsai and one of his Taiwanese businesses, Trans Merits Co., were convicted in that country of forging invoices and shipping restricted materials to North Korea, Eric Shiffman, a special agent with the Federal Bureau of Investigation, said in an affidavit for a complaint filed against the older Tsai.
The U.S. Treasury Department’s Office of Foreign Assets Control designated the father, Trans Merits and another company, Global Interface Co., as “proliferators of weapons of mass destruction.” A U.S. citizen, business, or person or or company in the country are barred from doing business with Alex Tsai, Trans Merits or Global, according to Shiffman’s affidavit.
Gary Tsai is accused of aiding his father or one of his businesses to acquire a center-hole grinder in September 2009. The device is described in the indictment as a “a precision machine tool used to grind a center hole with precisely smooth sides.”
Poulos last month described the metal drilling machine as an old and unsophisticated piece of equipment and the business transaction “benign.”
The men are charged with six counts of violating the International Emergency Economic Powers Act, each of which carries a maximum penalty of 20 years in prison and a $1 million fine, the government has said, with conspiracy to commit that crime, with conspiracy to defraud the U.S., which is punishable by as long as five years imprisonment and two counts of money laundering, each punishable by a prison sentence of as long as 20 years.
The case is U.S. v. Tsai, 12-cr-00829, U.S. District Court, Northern District of Illinois (Chicago).