Felony Export Indictment Names Southland Couple

In what was described as a major export violation case, a federal grand jury on Friday indicted a Southern California couple and a Hong Kong importer on charges of illegally shipping nearly $1 million in sophisticated electronic equipment to Pakistan.

The indictments charge that the couple, Arnold I. and Rona K. Mandel, conspired with importer Leung Yiu Hung, also known as Paul Leung, to conceal the sale to Pakistan of electronic testing and measuring equipment by shipping it first through Hong Kong.

U.S. Atty. David Levi, who announced the indictments, refused to say what the equipment was to be used for. However, Levi referred to an arrest earlier this week in Philadelphia of a Pakistani citizen charged with trying to export to Pakistan material that could be used in making nuclear weapons.

In that case, the Pakistani, Arshad Z. Pervez, was accused of attempting to buy for export 50,000 pounds of a special steel alloy used in nuclear enrichment plants. Pakistan, which has refused to sign a nuclear non-proliferation treaty, has long been rumored to be trying to develop its own nuclear weapons system but has publicly denied the reports.

George O’Connell, an assistant U.S. attorney assigned to prosecute the California case, would not comment on possible links to nuclear weapons manufacture. However, O’Connell said the materials exported by the Mandels and Leung can be used for a wide variety of applications, “including high-energy research and measuring energy output from sources, including explosive sources.”

“We regard this as a significant case,” O’Connell said.

Levi added that the indictments reflect “the high priority placed upon the enforcement of the export control laws.”

The federal Export Administration Act bars the export, without a valid license from the U.S. Department of Commerce, of certain types of equipment that are tied to U.S. strategic or foreign policy interests. According to Levi, before an exporter can obtain such a license for shipment to Hong Kong, he must secure a certificate from the Hong Kong government certifying that it will not be reshipped elsewhere.

15 Shipments

The indictments, according to Levi, charge that the Mandels made 15 shipments of sophisticated computers and other electronic gear to Hong Kong between July, 1982, and August, 1983. They also charge that Leung made four shipments from Hong Kong to Pakistan. In none of the cases did the Mandels or Leung have proper export licenses, Levi said.

Leung reportedly was directing a Hong Kong business called Fortune Enterprise Co., which imports high-tech electronic equipment from the United States. The Mandels operated two exporting businesses, United States Equipment Remarketing Services and a company called TIRRCO. Both reportedly were based in San Carlos but were moved to the Sierra foothill community of Auburn in 1982.

The Mandels are believed to be living in Southern California but Levi would not release specific information on their whereabouts.

According to the indictments, the Mandels applied for an export license in 1982 but were refused one because they did not provide detailed enough descriptions of the equipment to be shipped and could not produce certificates guaranteeing that the materials would not be shipped elsewhere.

Even after they were turned down, however, Levi said the Mandels continued to ship equipment to Leung in Hong Kong. Eventually, Levi added, Leung gave the Mandels documents showing that the equipment was not being shipped out of the country. But the indictments charge that at the time, Leung already was in the process of sending the equipment to Pakistan.

The equipment, some of which reportedly is used in high-energy research, reportedly included sophisticated computers and oscilloscopes. Most of the equipment was manufactured by Tektronix Inc., an Oregon corporation that has not been implicated in the case.

The investigation was conducted by agents of the U.S. Department of Commerce after information from a source familiar with the shipments. O’Connell said agents later searched the Mandels’ business office and discovered evidence linking the pair to a number of transactions.

Levi said the Mandels had been notified to appear in Federal Court in Sacramento on Aug. 10. The pair face a maximum sentence of 115 years in prison and fines of up to $478,000.

Leung continues to reside in Hong Kong. Levi said he would seek to have him extradited to face charges here. But O’Connell said the extradition treaty between Hong Kong and the United States does not provide for extradition on export violation charges. O’Connell said Leung could be extradited on lesser wire fraud charges, however.