A Chinese executive has been sentenced to a year in prison and ordered to pay penalty of $100,000 for conspiring to illegally export high-performance coatings to a nuclear power plant in Pakistan.
Xun Wang, a former managing director of PPG Paints Trading (Shanghai), which is a wholly-owned Chinese subsidiary of United States-based PPG Industries, has also been asked by a district court in Washington DC to perform 500 hours of community service.
52-year-old Wang pleaded guilty to the conspiracy in November 2011, and agreed, as part of her plea, to cooperate with the government's investigation. Her cooperation led to the December 3, 2012, guilty plea by the China Nuclear Industry Huaxing Construction Co, Ltd.
That plea is believed to have marked the first time that a People's Republic of China corporate entity has entered a plea of guilty in a US criminal export matter, the Department of Justice said.
As part of its plea agreement, Huaxing agreed to the maximum criminal fine of $2 million, $1 million of which will be stayed pending its successful completion of five years of corporate probation.
"Xun Wang was the most senior PPG Paints Trading corporate executive involved in this unlawful export scheme," said the US Attorney, Ronald Machen.
"This prosecution has already held corporations accountable for their violations of US export laws, but today's prison sentence shows our determination to hold corporate executives personally responsible when they compromise our nation's security in the pursuit of corporate profits," he said.
According to the Department of Justice, in November 2011, Wang also settled an administrative proceeding brought by the Department of Commerce regarding the same subject matter as her criminal case.
As part of her settlement agreement, Wang has agreed to pay a civil penalty of $200,000 with another $50,000 payment suspended, and to be placed on the Department of Commerce's Denied Persons' list for a period of five years with an additional five years suspended.
As a denied person, Wang will be prohibited from directly or indirectly participating in any transaction involving a commodity, software or technology exported, or to be exported, from the United States that is subject to Department of Commerce regulations.
Wang, federal authorities said, is accused of conspiring to export, reexport, and transship high-performance epoxy coatings to the Chashma II Nuclear Power Plant in Pakistan, a nuclear reactor owned and/or operated by the Pakistan Atomic Energy Commission, an entity on the Department of Commerce's Entity List.
Wang's conviction is related to the December 21, 2010, guilty plea of PPG Paints Trading to four-count information in the US District Court for the District of Columbia.
Together, PPG Paints Trading and its parent company, PPG Industries, paid $3.75 million in criminal and administrative fines and more than $32,000 in restitution.
The combined amount of criminal and civil fines represented one of the largest monetary penalties for export violations in the history of the Bureau of Industry and Security.