Prison for CEO who Conspired to Export Specialty Metals to Iran

Erdal Kuyumcu, the chief executive officer of Global Metallurgy, LLC, based in Woodside, New York, has been sentenced to 57 months in prison following his June 14, 2016 guilty plea to conspiracy to violate the International Emergency Economic Powers Act by exporting specialty metals from the United States to Iran.

The sentencing proceeding was held before Chief United States District Judge Dora L. Irizarry.

The sentence was announced by Bridget M. Rohde, Acting United States Attorney for the Eastern District of New York, Dana J. Boente, Acting Assistant Attorney General for National Security, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation (FBI), and Jonathan Carson, Special Agent-in-Charge of the U.S. Department of Commerce’s Bureau of Industry and Security, Office of Export Enforcement’s New York Field Office.

“This Office, together with our law enforcement partners, will continue to use every tool available, including U.S. export laws, to prevent goods with potentially dangerous uses from falling into the wrong hands and jeopardizing our national security,” stated Acting United States Attorney Rohde. “Here, the defendant exported a metallic powder that has potential military and nuclear applications to Iran, a state sponsor of terrorism.”

“With this sentence, the defendant is being held accountable for conspiring with others to send specialized U.S. technology – over a thousand pounds of metallic powder with nuclear and missile applications – to Iran via Turkey,” stated Acting Assistant Attorney General Boente.  “The National Security Division will aggressively prosecute those who seek to unlawfully provide dangerous material and technology to Iran, a state sponsor of terrorism.”

“Laws exist to keep groups and governments from buying materials in support of doing harm.  Iran has demonstrated in this case it is willing to use whatever means necessary to hide the end user of the materials, to include utilizing a U.S. citizen to carry out their proliferating activities,” stated Assistant Director-in-Charge Sweeney.  “The FBI New York and its foreign and domestic partners work every day to investigate and interdict adversaries from procuring these items and materials to build nuclear and other weapons of mass destruction, which could end up in dangerous hands.”

“Today’s sentencing is the result of outstanding collaborative work by the Justice Department, the Commerce Department and the FBI to break up a network whose aim was to illegally ship sophisticated U.S.-origin technology to Iran,” said Special Agent-in-Charge Carson.  “We will continue to pursue violators wherever they may be.”

According to court documents, Kuyumcu, a U.S. citizen, conspired to export from the United States to Iran a metallic powder primarily composed of cobalt and nickel, without having obtained the required license from the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC).  As established during a two-day presentencing evidentiary hearing, the metallic powder has potential military and nuclear applications.  Such specialized metals are regulated by the U.S. Department of Commerce to combat nuclear proliferation and terrorism, and exporting them without the required license is illegal.

In furtherance of the illegal scheme, Kuyumcu and others plotted to obtain more than 1,000 pounds of the metallic powder from a U.S.-based supplier.  To hide the true destination of the goods from the supplier, Kuyumcu arranged for the metallic powder to be shipped first to Turkey and then to Iran.  Kuyumcu used coded language when discussing shipment of the powder with a Turkey-based co-conspirator, such as referring to Iran as the “neighbor.”

Shortly after one of the shipments was sent from Turkey to Iran, a steel company in Iran sent a letter-sized package to Kuyumcu’s Turkey-based co-conspirator.  The Iranian steel company had the same address as an OFAC-designated Iranian entity under the Weapons of Mass Destruction proliferators sanctions program that was associated with Iran’s nuclear and ballistic missile programs.

The government’s case is being handled by the Office’s National Security & Cybercrime Section.   Assistant U.S. Attorneys Tiana A. Demas and Ameet B. Kabrawala, and Trial Attorney David Recker from the National Security Division’s Counterintelligence and Export Control Section, are in charge of the prosecution.

(Source: US Dept of Justice)

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