The former owner and chief executive of a California-based military contractor has been arrested for allegedly breaking federal export laws by transferring sensitive U.S. technology to countries such as China.
The 77-year-old Joe Sery, who used to run Tungsten Heavy Powder & Parts (Tungsten Parts), has been indicted by a federal grand jury on charges of “knowingly and willfully” exporting military intelligence, including data and drawings, to China and India without U.S. approval, the Justice Department announced on March 5.
The San Diego-based company supplies fragments and weapon-grade components made of tungsten, a rare metal, to the military.
Prosecutors have identified Sery’s 70-year-old brother, Dror Sery, a dual citizen of Israel and South Africa, as a co-conspirator. An arrest warrant has been issued for the man, who remains a fugitive and is believed to be living in Israel.
The brothers allegedly created a non-company email to secretly access the sensitive documents from Tungsten Parts’ system, to which Dror Sery was then given full access. The two then exported the sensitive technical drawings by email when Dror was in India and China, according to the U.S. Attorney’s Office for the Southern District of California.
It’s unlawful to transfer data, goods, and services that are designated as defense items out of the United States without a license, or to release such technical data to a foreign individual in the United States, according to the International Traffic in Arms Regulations. If convicted, violators face a maximum penalty of up to 20 years in prison and a $1 million fine.
Tungsten Parts entered into contracts with multiple aerospace and defense companies from 2016 to 2019 to work on projects involving the construction of an advanced rapid response weapon, a 155-millimeter bi-modal warhead, a R9E warhead, and an 81-millimeter cowling cone, prosecutors said.
Tungsten Parts is facing a lawsuit from a former employee from its San Diego facilities who alleges that Dror Sery once sent an email requesting a customer’s intellectual property to be sent to a company in China that makes balancing machines, court filings show.
The employee accused Tungsten Parts of sending technical drawings to China-based suppliers after removing or blocking out markings identifying them as export-controlled.
Tungsten Parts officials didn’t immediately respond to a request by The Epoch Times for comment about the allegations.
According to the indictment, “these brothers disregarded important regulations designed to keep sensitive information from falling into the hands of those who would harm America,” U.S. Attorney Randy Grossman said.
Chad Plantz, special agent in charge for Homeland Security Investigations San Diego, said that the investigative agencies are committed to ensuring “protected military technology and weaponry are not used by foreign actors against our warfighters and allies on the battlefield.”
“This arrest sends a clear message that those entrusted with our country’s military technology and weaponry will be held responsible for its safeguarding,” he said.
Last year, under the name Tungsten Heavy Powder Inc., the company agreed to pay $5.6 million to settle allegations that it had falsely certified product materials as from the United States when they actually came from China.
Tungsten Parts has agreed to assist with the investigation, the prosecutors said.
Joe Sery is due to appear in court on March 7.
