Extradited from Indonesia to the United States early last year, Lim Yong Nam, a Singaporean national, was sentenced last week in U.S. federal court to forty months prison for illegal exports of American-made dual-use products to Iran. Kim was part of a group that included at least ten persons and companies that were indicted by a grand jury in 2009 of multiple violations of U.S. export controls and economic sanctions laws. Among other places, Nam’s co-conspirators had offices China, Singapore, and Hong Kong who set up what appears to be a typical Iran sanctions evasion network.
Nam was nabbed for his role in buying radio frequency modules from a company in Minnesota that had encryption capabilities with a particularly long range. The RFID modules transmitted data wirelessly across distances as great as 40 miles when configured with a high-gain antenna, hence, used in IEDs and other bombs. The other conspirators exported compact, light-weight antennas suitable for airborne or shipboard direction finding systems or radar warning receiver applications; as well as a biconical antenna used in several U.S. combat jets. The antennas were purchased from two Massachusetts-based entities.
It appears that the initial order was made from a company based on Hong Kong that, after pitching the proposed sale to a buyer in Iran and answering a few end-use and end-user questions from the Minnesota company, shifted the order to a buyer to at least two buyers in Singapore. After the modules were exported to Singapore, but before they were reexported to Iran, the modules were “sold” to yet another Singapore business. There was another transaction that went through Thailand, another via Malaysia.
These sort of cases remind us of the lengths the Iranian regime will go to get their hands on dual-use items and defense articles. And, unfortunately, the Iranians and other rogue regimes that help do this all the time. They are not going to stop. Ever. However, the smuggling supply chain and corporate spread used in this case seems typical. The Iranians and their trade partners make it work. I’m not sure of the data, but for every transaction the U.S. and allies block, who knows how many get through. You’d think the Iranians, North Koreans, or heck, even the Cubans would’ve caught on by now and tied something different, and they have.
In 2013, for example, Cuba got caught smuggling weapons and defense components to North Korea via the Panama Canal. The illegal shipment was hidden in a barge under several tons of Cuban sugar. Most cases are not as sensational. They are like this Nam situation where small transactions from small and medium-sized businesses start, seemingly innocent enough, but are really part of a complex criminal web that set out to undermine U.S. sanctions and export control laws. For lawyers who advise companies on export controls and economic sanctions matters, proposed sales of U.S. controlled items that include any of the intermediary countries in transactions like this one should set off more than a few flags.
Finally, if you’re wondering why any of this matters consider the following. According to the Justice Department, at least 16 of the RFID modules Nam helped export were later found in unexploded improvised explosive devices (IEDs) in Iraq.