2 Indicted in Plot to Sell Missiles

A federal grand jury indicted two men Wednesday on charges of conspiring to smuggle as many as 200 shoulder-fired surface-to-air missiles into the United States through the Port of Long Beach

The alleged plot was broken up in August when federal law enforcement authorities arrested 59 people on both coasts who allegedly belonged to what they described as a “one-stop-shopping” crime organization that smuggled contraband cigarettes, illicit drugs, weapons and other goods.

Chao Tung Wu, 51, of La Puente and Yi Qing Chen, 41, of Rosemead, both naturalized U.S. citizens, were initially charged with conspiring to smuggle methamphetamine, Ecstasy and counterfeit Marlboro cigarettes into the country.

But on Wednesday, federal authorities obtained a new indictment accusing them of also brokering the sale of 200 Chinese-made QW-2 missiles to an undercover FBI agent.

Manufactured in China, the QW-2 is a heat-seeking missile with a range of 3.7 miles. It is patterned after the U.S.-made Stinger missile.

While surface-to-air missiles have been viewed by some counterterrorism officials as a growing threat to commercial aviation, there was no indication that the defendants believed the weapons would be used in the United States.

“The undercover agent told the smugglers that the missile systems would be sent abroad and would not be used in the United States,” said Thom Mrozek, spokesman for the U.S. attorney’s office.

Lawyers for Wu and Chen did not return calls seeking comment.

The arrests grew out of a sting investigation in which the undercover agent, beginning in September 2004, established contact with the two men, posing as a dealer in contraband goods.

The scheme, which took shape in talks and meetings over many months, called for the weapons to be shipped to the United States in cargo containers, with bills of lading marked “machine components,” the indictment said.

Falsified documents were to be used to make it appear that the goods came from a third country.

The indictment said Wu and Chen made trips overseas to arrange for the purchase, which allegedly involved a “general” in “Country One” and various other foreign nationals who were cited as un-indicted co-conspirators. The indictment did not name “Country One.” Sources close to the investigation said “Country One” was China.

Assistant U.S. Atty. Mark Aveis said the decision not to name the country was made by Justice Department officials in Washington.

The missiles’ price tag was not disclosed. However, the indictment said that Wu and Chen told the undercover agent he would have to pay a $2-million bribe to a relative of the president of one of the countries involved.

None of the money was paid. Before the deal was concluded -- or any money, including the alleged bribe, changed hands -- Wu and Chen were arrested.

According to the indictment, their overseas confederates continued to deal with the FBI agent, never suspecting his true identity.

Wu and Chen, who are being held without bond, face 25-year-to-life prison sentences if convicted. They were charged under a statute enacted last year increasing the penalty for persons found guilty of importing missile systems designed to destroy aircraft.

Wu is also charged with taking part in a scheme to smuggle into the United States extremely high-quality counterfeit $100 bills made in North Korea and known in law enforcement circles as “supernotes.”

More than $1.2 million in “supernotes” were seized.