The New Taipei District Prosecutors' Office today indicted 10 people for reselling US high-tech chips after obscuring their origin to skirt export controls on strategic semiconductors.
Prosecutors said their actions helped China strengthen its military capabilities, affected Taiwan's national security and damaged Taiwan's international reputation.
Investigators believe that Lypid Taiwan Co (優活科技) head Chen Chien-hsiung (陳建雄) and others had forged documents since 2017 and falsely claimed to represent the National Chung-shan Institute of Science and Technology (NCSIST).
Photo: Taipei Times
They fraudulently purchased controlled chips for military use manufactured by Texas Instruments and Analog Devices from domestic distributors, prosecutors said.
They then allegedly disguised their country of origin to present them as non-controlled chips before illegally exporting them to China and Hong Kong, they said.
They are suspected to have generated NT$360 million (US$11.33 million) in illicit profit, they said.
Chen and nine other defendants were indicted on charges including aggravated fraud, document forgery and money laundering, they added.
Prosecutors said they are seeking prison sentences of between one and 10 years, with the maximum sought for Chen.
The defendants include Chen's younger brother, the former head of Lypid Taiwan and the heads of Stone Engine Technology Co (石擎科技) and WTG Technology (睿虎科技).
They also include the heads of KPlus Technology (凱盟資通), HGT Application Inc (洪巨科技), EcoLumina Technologies Inc (晟明科技) and ZKey Technology Inc (華謚科技), they said.
The defendants are suspected of illegally exporting more than 10 models of controlled chips originating in the US, the Philippines, Malaysia, South Korea and elsewhere that could be used for military applications such as radar, electronic systems, ultrasound equipment, antenna arrays and uncrewed aerial vehicles (UAVs), they said.
Purchasers must provide a statement confirming the end user, the intended use and the destination of the products, they said.
If the location is in China or a restricted foreign market, the original manufacturer or distributor would refuse the transaction, they added.
The group falsely claimed that the NCSIST was the end user and promised that the chips would not be exported or resold to parties subject to US sanctions, prosecutors said.
They repackaged the chips and changed model numbers to declare them as "made in Taiwan," then exported them to China or Hong Kong as non-controlled chips, they said.
A separate group run by Lai Chin-lan (賴金蘭) allegedly used similar methods to sell controlled chips certified to a US military specification to Hong Kong, earning about NT$130 million, they said.
A third suspected participant, Yuan Tung-tai (袁同台), allegedly sold chips involving applications for UAVs, earning more than NT$100 million in illicit proceeds, they added.
Additional reporting by CNA
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