A Taiwanese businessman long suspected of ties to North Korea and his son have been charged in Chicago with seeking to bypass a US ban on the export of weapons machinery to the communist nation, US federal prosecutors announced on Monday.
Alex Tsai Hsien-tai (蔡顯泰), 67, and his 36-year-old son, Gary Tsai Yueh-hsun (蔡岳勛), are charged with one count each of conspiracy to defraud the US in its enforcement of laws prohibiting the proliferation of weapons of mass destruction, a statement from the US Attorney’s Office in Chicago said.
The statement suggests a wider investigation.
Federal agents have been investigating the two men and a network of companies on suspicion of trying to export goods and machinery from the US “that could be used to produce weapons of mass destruction,” it said.
The father, who lives in Taiwan, was arrested on Wednesday in Tallinn, Estonia. The statement from prosecutors does not speculate about why Alex Tsai was in Estonia, though it says US authorities are seeking his extradition. The son, a legal US resident, was arrested on the same day last week at his home in suburban Glenview, just outside Chicago, prosecutors said.
The arrest comes as North Korea, under the leadership of Kim Jong-un, has faced international criticism over its nuclear and weapons-development programs. The federal complaint released on Monday did not offer details about which weapons systems the machinery could have benefited.
The elder Tsai fell under suspicion at least as far back as 2008, when he was convicted in Taiwan of forging shipping invoices and illegally shipping restricted materials to North Korea, the US Department of Treasury said in press release at the time.
US Treasury officials accused him of shipping items to North Korea that could be used to support its advanced weapons program, and the department in 2009 placed a wide-ranging prohibition on him doing any business in or with the US. The ban applied to him and several Taiwanese-based companies he helped run, including Trans Merits Co Ltd (蓮笙興業有限公司) and Trans Multi Mechanics Co Ltd, the complaint says.
It was the alleged bid to skirt the 2009 prohibition, with the son’s alleged help, that led to the charges in Chicago. Among the items they were accused of conspiring to export was what prosecutors described as “a Bryant center hole grinder,” which is used to drill precise, smooth holes through elongated metal, the complaint says. The machinery got to Taiwan, but the complaint does not state whether it reached North Korea.
Gary Tsai appeared in a federal courtroom in Chicago on Monday. Magistrate Judge Susan Cox agreed to his release on US$500,000 bond. He will be confined to his home and will be under electronic monitoring.
Speaking to reporters later on Monday, Ted Poulos, the younger Tsai’s attorney, insisted the machinery involved was “unsophisticated.”
“And there is no allegation Mr [Gary] Tsai knew it was destined for North Korea,” Poulos said.
As for the business deals involved, Poulos said: “It amounts to a rather benign business transaction.”
In addition to the count of conspiracy to defraud US proliferation laws, the father and son each face one count of conspiracy to violate the International Emergency Economic Powers Act, which carries a maximum prison sentence of five years, and one count of money laundering, which carries a maximum term of 20 years.