California Man Sentenced for Illegally Exporting Cesium Atomic Clocks to Hong Kong
Cesium atomic clocks are used in global positioning system solutions, network timing protocols, encryption programs and national defense and space applications
BOSTON – A California man was sentenced on Wednesday, March 3, 2020 in federal court in Boston for illegally exporting cesium atomic clocks to Hong Kong.
Alex Yun Cheong Yue, 69, of South El Monte, Calif., was sentenced by U.S. District Court Judge Indira Talwani to time-served (one day) and three years of supervised release, a year of which must be served in home confinement. Yue is also prohibited from engaging in import or export transactions during the period of supervised release. In August 2020, Yue pleaded guilty to one count of conspiracy to commit export violations, two counts of unlawful exports and attempted exports of U.S. goods to Hong Kong and one count of smuggling.
Yue was arrested and charged in June 2019. Wai Kay Victor Zee, 56, of Hong Kong, along with his company, Premium Tech Systems, Limited were also charged. Zee remains at large in Hong Kong Special Administrative Region of the People’s Republic of China.
Beginning in December 2015, Yue, Zee, and Premium Tech conspired to procure U.S.-origin cesium atomic clocks and export them to Hong Kong without obtaining the required export licenses. Cesium atomic clocks are used in global positioning system solutions, network timing protocols, encryption programs and national defense and space applications. They are controlled for export by the U.S. Department of Commerce for national security reasons.
To obtain the atomic clocks, Yue purchased them using a fictitious company, “Ecycle Tech International Ltd.,” by falsely representing to the U.S. seller that the atomic clocks would be used solely in the United States for cordless phone research and development. Based on Yue’s false representations, the U.S. seller sold the cesium atomic clocks to Ecycle. On Feb. 19, 2016, the atomic clocks shipped from the manufacturing facility in Beverly, Mass., to Yue in California. Three days later, on Feb. 22, 2016, Yue reshipped the controlled cesium atomic clocks to Zee at Premium Tech in Hong Kong, with paperwork that falsely described what the clocks were and undervalued their worth. Neither Yue, Zee, nor Premium Tech ever applied for or obtained the required export licenses from the U.S. Department of Commerce. On Feb. 24, 2016, Zee allegedly confirmed receipt of the cesium atomic clocks in Hong Kong.
In December 2017, Yue attempted to purchase an additional cesium atomic clock. Prior to the sale, however, the U.S. seller required Yue to provide an end-user statement detailing where and for what the clocks would be used. In April 2018, Yue sent an end-user certificate on Ecycle letterhead stating that the atomic clocks would be used in a calibration lab in California. In response to further inquiries from the U.S. seller, Yue falsely declared that he was not intending to export the cesium atomic clocks. When the U.S. seller insisted on a site visit to the California location where the atomic clocks would be utilized, Yue abruptly canceled the order. On July 13, 2018, Yue received a refund payment from the U.S. seller. Three days later, on July 16, 2018, Yue sent a wire transfer to Premium Tech’s bank account in Hong Kong with the refunded money.
Acting United States Attorney Nathaniel R. Mendell; William Higgins, Special Agent in Charge of the Department of Commerce, Office of Export Enforcement, Boston Field Office; and William S. Walker, Acting Special Agent in Charge of the Homeland Security Investigations in Boston made the announcement today. Assistant U.S. Attorney Scott Garland, Deputy Chief of Mendell’s National Security Unit, prosecuted the case.