EB-5 Investor Jailed for Sales to Chinese Navy — and a Mea Culpa

By David North on December 3, 2018

Some months ago I wrote a posting about what seemed to be a silly set of federal charges against a Chinese national in Massachusetts who had secured an EB-5 visa.

The charges did not sound serious; he had sold a bunch of mid-tech devices, costing no more than $1,500 each, to a Chinese university. These were hydrophones that are sold on the open market here in the States, and can be exported to individuals in China — but not to the Chinese military, a seemingly bizarre way to manage military exports. The exporter had not secured the licenses needed for such a transaction.

The hydrophones can be used to detect movements of fish — or submarines — under water. The university concerned, Northwestern Polytechnic University (NPU), is said to be linked to the People's Liberation Army's Navy, though on a map, NPU looks like it is more than 500 miles from any navigable body of water.

The whole thing did not seem to make sense and, frankly, I had forgotten about it until a reader asked if there had been any new developments in the case. She may have known the answer, but her brief note did not suggest that.

The answer to her question is a resounding "yes" and the case's serious underpinnings have since come to light in court proceedings documented in the PACER system as case 1:18-cr-10205-DJC. Among other things:

  • The courts found the charges serious enough to send Shuren Qin into pre-trial detention for more than six months on the grounds he was a flight risk;
  • When he finally won at a bail hearing, the bond was set at $1.5 million; $500,000 in cash and the rest in real estate owned by his family and friends;
  • An indictment filed at the end of October said that he "had exported or caused to be exported, among other things, remotely operated side scan sonar systems, unmanned underwater vehicles, unmanned surface vehicles, robotic boats and hydrophones."

What the federal prosecutors had done initially, apparently, was to use proof that they had in the hydrophone matter to toss him in jail, while they worked up a far more significant case. Though Qin may be found innocent, ultimately, it now sounds like putting Al Capone in prison for income tax violations.

Qin had secured his entrance to the United States by investing in an EB-5 real estate deal in 2014, about which no more is known; he had for the previous nine years been running Linkocean Technologies LTD, then headquartered in China. More recently, he has run the firm, of which he is president, from his home in Wellesley, Mass.

The firm exported a range of maritime products, but when he was asked by DHS, in connection with his EB-5 application, about what he shipped he responded, according to the indictment, that he "only" exported instruments that attach to a buoy.

That statement was false, according to the feds, and he has been charged with visa fraud, along with export and money laundering violations.

I will try to remember to stay in touch with the trial; should he be convicted it will add a national security case to the long and varied list of crimes committed within the EB-5 (immigrant investor) program.

By the way, the Northwestern Polytechnic University of China, mentioned above, is not to be confused with the controversial visa mill of the same name, also under Chinese management, in Fremont, Calif. The latter may have been named after the former, however.