Circuits Assembly Online Magazine - Chinese Citizen Pleads Guilty to Counterfeiting ICs

NEW HAVEN, CT -- A Shenzhen citizen faces up to 10 years in prison after pleading guilty in a US federal court to conspiring to sell knockoffs of ICs to a purchaser in the US.

According to court documents and statements made in court, Daofu Zhang, 40, pleaded guilty to selling ICs made by Xilinx, which had military applications, including radiation tolerance for uses in space.

According to court records, Zhang tried to get an undisclosed US individual to locate the Xilinx ICs and sell them to a co-conspirator in China. The US individual explained that the ICs cannot be shipped outside the US without an export license, but the co-conspirator, named as Jiang Yan, still wished to make the purchase. When the US individual expressed concern that the desired ICs would have to be stolen from military inventory, Yan proposed to supply the US source with “fake” ICs that “look the same,” to replace the ones to be stolen from the military.

In November 2015, Zhang shipped from China to the US individual two packages containing a total of eight counterfeit ICs, each bearing a counterfeit Xilinx brand label. After further discussions between Yan and the US individual, Yan, Zhang and a third conspirator, Xianfeng Zuo, flew together from China to the US in early December to complete the Xilinx ICs purchase. On Dec. 10, 2015, federal agents arrested the three conspirators a location near Milford, CT, where they planned to meet the US individual, make payment, and take custody of the Xilinx ICs.

Zhang pleaded guilty to one count of conspiracy to traffic in counterfeit goods. He is scheduled to be sentenced on Jul. 8, at which time he faces a maximum term of imprisonment of 10 years and a fine of up to $2 million fine.

Yan, 33, pleaded guilty in March to one count of conspiracy to traffic in counterfeit goods, and one count of attempt to export integrated circuits without the required export license. Likewise, Zuo, 38, also pleaded guilty in March to one count of conspiracy to traffic in counterfeit goods. They await sentencing.