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Chinese Nationals Charged with Evading U.S. Sanctions
Four Chinese nationals and a trading company based in Dandong, China, have been charged with conspiring to evade U.S. economic sanctions and violating the Weapons of Mass Destruction Proliferators Sanctions Regulations (WMDPSR) through front companies.
According to the indictment, Ma Xiaohong, the CEO of Dandong Hongxiang Industrial Development Co. Ltd. (DHID), and three of its top executives, general manager Zhou Jianshu, deputy general manager Hong Jinhua, and financial manager Luo Chuanxu, allegedly used front companies to facilitate prohibited U.S. dollar transactions through the United States on behalf of a sanctioned entity in the Democratic People’s Republic of Korea (North Korea).
The indictment alleges that the defendants laundered the proceeds of this criminal conduct through U.S. financial institutions.
The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has imposed sanctions on DHID, Ma, Zhou, Hong, and Luo for their ties to the government of North Korea’s weapons of mass destruction proliferation efforts.
A civil forfeiture action has been filed for all funds contained in 25 Chinese bank accounts that allegedly belong to DHID and its front companies.
The U.S. government has requested a restraining order for all of the funds named in the civil forfeiture action, alleging that they represent property involved in money laundering.
The charges against Ma Xiaohong and her co-defendants include conspiracy to violate the International Emergency Economic Powers Act (IEEPA) and to defraud the United States, violating IEEPA, and conspiracy to launder monetary instruments.
Ma Xiaohong, the CEO of Dandong Hongxiang Industrial Development Co. Ltd. (DHID), and her co-defendants were charged by a criminal complaint unsealed on August 3, 2016, in the District of New Jersey.
There are no allegations of wrongdoing by the U.S. correspondent banks or foreign banks that maintain these accounts.
The case is being prosecuted by the Justice Department’s Criminal Division.
The FBI’s Counterintelligence Division is investigating the case.
Key Facts
- State: Federal
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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