November 09th, 2022
Defendants Allegedly Sent Technical Data Drawings Related to U.S. Military Projects to China and then Supplied the Department of Defense with Prohibited Chinese-Origin Items
A federal indictment was unsealed following the arrest of three defendants and their initial appearances in the U.S. District Court in the Western District of Kentucky.
According to court documents, Phil Pascoe, 60, of Floyds Knobs, Indiana; Monica Pascoe, 45, of Floyds Knobs, Indiana; Scott Tubbs, 59, of Georgetown, Kentucky; and Quadrant Magnetics LLC are charged with wire fraud, violations of the Arms Export Control Act, and smuggling of goods for their roles in an illegal scheme to send export-controlled defense-related technical data to China and to unlawfully supply U.S. Department of Defense (DOD) with Chinese-origin rare earth magnets for aviation systems and military items.
The indictment alleges that between January 2012 and December 2018, the defendants conspired to send approximately 70 drawings containing export-controlled technical data to a company located in China without a license from the U.S. government, in violation of the Arms Export Control Act and the International Traffic in Arms Regulations. The technical data drawings were the property of two U.S. companies and related to end-use items for aviation, submarine, radar, tank, mortars, missiles, infrared and thermal imaging targeting systems, and fire control systems for DOD.
The indictment further alleges that Quadrant Magnetics imported rare earth magnets that were smelted and magnetized by a company in China. Quadrant then sold these magnets to two U.S. companies which included them in components sold to DOD for use in the F-16, the F-18, and other defense assets in violation of the Defense Acquisition Regulations System (DFARS). Under the DFARS specialty metal clause, rare earth magnets sold to DOD must be produced and magnetized in the United States or an approved country. China is not an approved country. back...
A federal indictment was unsealed following the arrest of three defendants and their initial appearances in the U.S. District Court in the Western District of Kentucky.
According to court documents, Phil Pascoe, 60, of Floyds Knobs, Indiana; Monica Pascoe, 45, of Floyds Knobs, Indiana; Scott Tubbs, 59, of Georgetown, Kentucky; and Quadrant Magnetics LLC are charged with wire fraud, violations of the Arms Export Control Act, and smuggling of goods for their roles in an illegal scheme to send export-controlled defense-related technical data to China and to unlawfully supply U.S. Department of Defense (DOD) with Chinese-origin rare earth magnets for aviation systems and military items.
The indictment alleges that between January 2012 and December 2018, the defendants conspired to send approximately 70 drawings containing export-controlled technical data to a company located in China without a license from the U.S. government, in violation of the Arms Export Control Act and the International Traffic in Arms Regulations. The technical data drawings were the property of two U.S. companies and related to end-use items for aviation, submarine, radar, tank, mortars, missiles, infrared and thermal imaging targeting systems, and fire control systems for DOD.
The indictment further alleges that Quadrant Magnetics imported rare earth magnets that were smelted and magnetized by a company in China. Quadrant then sold these magnets to two U.S. companies which included them in components sold to DOD for use in the F-16, the F-18, and other defense assets in violation of the Defense Acquisition Regulations System (DFARS). Under the DFARS specialty metal clause, rare earth magnets sold to DOD must be produced and magnetized in the United States or an approved country. China is not an approved country. back...
