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Man charged with selling Chinese fake parts to US military

Last Updated: Tuesday, July 16, 2013 - 13:33

Washington: An American businessman has been charged with importing counterfeit semiconductors from China for sale in the US, some of which were intended to be used in military equipments like nuclear submarines.

It is unclear if any of the counterfeit electrical components made its way to US military hardware, but authorities said Peter Picone, 40, sold them to customers throughout the US, "including companies believed to be defence contractors in Connecticut and Florida".

The charges suggest that two companies Picone owned and operated- Tytronix Inc. And Epic International Electronics - purchased counterfeit semiconductors from sources in Hong Kong and China between 2007 and 2012.

"Picone went to great lengths to conceal the true origin of counterfeit semiconductors in order to sell the devices as seemingly legitimate and reliable components for use in nuclear submarines and other complex machinery," said US Acting Assistant Attorney General Mythili Raman.

Certain semiconductors sold by Picone were intended for use on nuclear submarines, the Justice Department said.

"By allegedly purchasing and reselling counterfeit semiconductors for military applications, Peter Picone put personal gain above the safety and well-being of dedicated US servicemen and women," said Raman.

Picone, a citizen of Methuen, a suburb of Boston, Massachusetts, was produced before a US Magistrate Judge Donna F Martinez of the District of Connecticut in Hartford, and was released on bond. Trial is scheduled to begin on September 9.

Picone has been indicted on eight counts of conspiring to traffic in counterfeit goods, conspiring to traffic in counterfeit military goods, trafficking in counterfeit goods, conspiring to commit wire fraud, wire fraud and conspiring to commit money laundering.

If convicted, faces up to 75 years in prison based on the maximum terms for each charge.

"Counterfeit semiconductors pose a serious health and safety risk to consumers and end-users, and an even greater threat to the safety of the men and women of our armed services when they are sold for use in the military," said Acting US Attorney Deirdre Daly.

"We will prosecute these types of cases to the fullest extent of the law," he added.


First Published: Tuesday, July 16, 2013 - 10:31
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