US Indictment Shows Business Owner Allegedly Shipped Export Controlled Goods to Pakistan
The U.S. this month arrested and charged a Pakistani-Canadian national with conspiracy to violate U.S. export controls after DOJ said he illegally shipped millions of dollars worth of controlled items to entities in Pakistan, including ones on the Entity List, all while hiding the true end-users from U.S. exporters.
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U.S. authorities arrested Mohammad Jawaid Aziz, also known as Jay Siddiqui, March 21 while he was trying to cross from the U.S. into Canada, DOJ said in a press release. An indictment unsealed last week lists Siddiqui and the redacted names of two Pakistani citizens for their involvement in the scheme.
From 2003 through 2019, Siddiqui used his Canada-based company, Diversified Technology Services, to illegally buy U.S. goods on behalf of Entity Listed entities in Pakistan tied to the country’s nuclear, missile and unmanned drone programs, DOJ said. Those entities would arrange the purchases through Pakistan-based International Trading Company, and Siddiqui would allegedly buy the items directly from American companies, passing along an upcharge to the Pakistani customers.
Siddiqui hid the true destination from the U.S. exporters by having the products transshipped through third countries before being sent to Pakistan, DOJ said. The agency said Siddiqui would sometimes first have the goods directly shipped to his Canadian home -- which doubled as the address for his business, Diversified Technology Services -- before transhipping them to Pakistan.
Siddiqui sometimes also told U.S. companies that the buyer was a business that had actually been allegedly created by Siddiqui and others as a front company, the indictment said. One front company was based in Singapore and named GS Technology Pte Ltd.
“At no time would the defendants or their co-conspirators reveal to the U.S. companies that the ultimate end user of the goods was a prohibited end user in Pakistan,” the indictment said.
Siddiqui paid the U.S. companies using a credit card and was then reimbursed by the “restricted” end-users in Pakistan. He and others used another company, Pakistan-based Industrial Automation, to clear the goods through Pakistani customs, DOJ said. They also allegedly used Pakistan-based Skytech Engineering.
The indictment lists more than 25 illegal exports that Siddiqui helped to ship, ranging from export controlled microscopes, centrifugal pumps, lasers, monitors, machine controllers, drone parts, testing equipment, and more. The sales ranged from as little as a $644 export of mortar in January 2018 to a $204,000 shipment of a plano laser interferometer in August 2018.
DOJ said the U.S. in 2018 planted an undercover agent inside a U.S. company that had agreed to sell about $5,000 worth of linear actuators to Siddiqui. Siddiqui told the undercover agent that the items would be used for a “commercial application,” the indictment said.
Siddiqui was charged with conspiracy to violate the International Emergency Economic Powers Act and Export Control Reform Act, which carries a maximum five-year prison sentence. He also was charged with violating ECRA, which carries a maximum 20-year sentence.