Washington State Man and Company Plead Guilty to ITAR Violations for Transfer of Data
A Woodville, Wash.-based company and its owner pleaded guilty July 30 to violating the Arms Export Control Act and committing wire fraud by sending restricted information overseas. Precision Image Corporation and its owner, Chih-Kwang Hwa, contracted with the U.S. Navy to produce circuit boards. But instead, Precision Image hired a Taiwanese company to manufacture the circuit board, and illegally sent restricted information on how to produce them, said the U.S. Attorney’s Office for the Western District of Washington. Precision Image faces a fine of up to $1 million, and Hwa up to 20 years in prison, although a plea agreement stipulates lesser penalties for each.
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Between 2009 and 2011, the U.S. Navy paid Hwa $180,034 to supply circuit boards, the attorney’s office said. The Navy provided technical data to Precision Image that contained technical specifications. That data was included on the U.S. Munitions List, and so couldn’t be transmitted outside the U.S. without a State Department License. According to the attorney’s office, Hwa knew about this restriction when he received the technical data from the Navy. But he sent to restricted data to a Taiwanese manufacturer anyway, the attorney’s office said. The Taiwanese-built circuit boards were later provided to the Navy. Many of the contracts awarded to Hwa were also set aside for U.S. manufacturers, which resulted in the additional charge of wire fraud against Hwa and Precision Image for misrepresentation of where the circuit boards were going to be produced.