CHICAGO — A former Taiwan resident admitted to supplying manufacturing machinery to North Korea that were used to construct weapons of mass destruction, the U.S. Department announced last week.
Hsien Tsai, 69, also known as “Alex Tsai,” was arrested in May 2013 in Tallinn, Estonia, and later was extradited to the United States, where he remains in federal custody, according to officials.
Tsai plead guilty Friday to conspiracy to violate U.S. regulations regarding the proliferation of weapons of mass destruction, officials said. He admitted that he engaged in illegal business transactions involving the export of U.S. goods and machinery.
He will be sentenced on Dec. 5 and faces up to five years in prison and a $250,000 fine. But federal prosecutors will recommend to the judge that he serve 30 months behind bars.
In pleading guilty, Tsai admitted that in September 2009 he was involved in the purchase of a Bryant center hole grinder from a U.S. company based in suburban Chicago, and exported it to Taiwan using the company Trans Multi Mechanics.
A Bryant center hole grinder is a machine tool used to grind a center hole, with precisely smooth sides, through the length of a material, officials said.
Tsai also admitted a role in Trans Merits’ transaction involving LED road lights and an oil pump. Charges remain pending against Tsai’s son, Yueh-Hsun Tsai, 37, of Glenview, Ill., also known as “Gary” Tsai, according to authorities. He was released on bond after he was arrested in May 2013 and has pleaded not guilty.
Court evidence showed the following, according to the federal government:
- Tsai was associated with at least three companies based in Taiwan—Global Interface Company Inc., Trans Merits Co. Ltd., and Trans Multi Mechanics Co. Ltd.—that purchased and then exported, and attempted to purchase and then export, from the U.S. and other countries machinery used to construct metals and other materials with a high degree of precision.
- In January 2009, the Treasury Department’s Office of Foreign Assets Control designated Tsai, Global Interface, and Trans Merits as proliferators of weapons of mass destruction, isolating them from the U.S. financial and commercial systems and prohibiting any person or company in the U.S. from knowingly engaging in any transaction or dealing with them.
- The Treasury Department said at the time that Tsai was designated for providing, or attempting to provide, financial, technological, or other support for, or goods or services in support of the Korea Mining Development Trading Corporation, which was designated as a proliferator.
- The federal government asserted that Tsai “has been supplying goods with weapons production capabilities to Korea Mining Development and its subordinates since the late 1990s, and he has been involved in shipping items to North Korea that could be used to support North Korea’s advanced weapons program.”
- In addition, the federal government stated that Global Interface was designated “for being owned or controlled by Tsai,” who was a shareholder of the company and acted as its president.
- Tsai was also the general manager of Trans Merits Co. Ltd., which was designated for being a subsidiary owned or controlled by Global Interface Company Inc.
- After the federal government designations, Tsai and others allegedly continued to conduct business together, but attempted to hide Tsai’s and Trans Merit’s involvement in those transactions by conducting business under different company names, including Trans Multi Mechanics. For example, by August 2009—approximately eight months after the federal government designations –Tsai and others allegedly began using Trans Multi Mechanics to purchase and export machinery on behalf of Trans Merits and Tsai.