Texas Man Sentenced for Conspiring to Illegally Export Radiation Hardened Integrated Circuits to Russia and China

Peter Zuccarelli, 62, of Plano, Texas was sentenced today to 46 months in prison for conspiring to smuggle and illegally export from the U.S. in violation of the International Emergency Economic Powers Act (IEEPA), radiation hardened integrated circuits (RHICs) for use in the space programs of China and Russia.  Zuccarelli was also sentenced to three years supervised release and a $50,000 fine.

Acting Assistant Attorney General for National Security Dana J. Boente and U.S. Attorney for the Eastern District of Texas Alan R. Jackson made the announcement after Zuccarelli was sentenced by U.S. District Judge Amos Mazzant.

According to the plea agreement, between approximately June 2015 and March 2016, Zuccarelli and his co-conspirators agreed to illegally export RHICs to China and Russia.  RHICs have military and space applications, and their export is strictly controlled.  In furtherance of the conspiracy, Zuccarelli’s co-conspirator received purchase orders from customers seeking to purchase RHICs for use in China’s and Russia’s space programs.  Zuccarelli received these orders from his co-conspirator, as well as payment of approximately $1.5 million to purchase the RHICs for the Chinese and Russian customers.  Zuccarelli placed orders with U.S. suppliers, and used the money received from his co-conspirator to pay the U.S. suppliers.  In communications with the U.S. suppliers, Zuccarelli certified that his company, American Coating Technologies, was the end user of the RHICs, knowing that this was false.  Zuccarelli received the RHICs he ordered from U.S. suppliers, removed them from their original packaging, repackaged them, falsely declared them as “touch screen parts,” and shipped them out of the U.S. without the required licenses.  He also attempted to export what he believed to be RHICs.  In an attempt to hide the conspiracy from the U.S. government, he created false paperwork and made false statements.

This case was investigated by the Dallas and Denver Offices of the Department of Homeland Security, Homeland Security Investigations; the FBI; the Department of Commerce, Bureau of Industry and Security, Office of Export Enforcement; the Department of Defense, Defense Criminal Investigative Service; and the U.S. Postal Inspection Service.  This case was prosecuted by the U.S. Attorney’s Office for the Eastern District of Texas and the Counterintelligence and Export Control Section of the Justice Department’s National Security Division.