AFFIDAVIT

I, Special Agent Alan Berkowitz, United States Department of Commerce, Bureau of

Industry and Security, Office of Export Enforcement (hereinafter OEE), being first duly sworn,
state as follows:
I. PERSONAL BACKGROUND
1.

I am employed as an OEE Special Agent and have been so employed since August 1997.1

Before commencing my employment with OEE, I was employed as an Inspector with the United
States Customs Service, now known as the Bureau of Customs and Border Protection (CBP),
for approximately two years, and, prior to that, as a Revenue Officer with the Internal Revenue
Service (IRS) for approximately four years. Currently, I am empowered by law to investigate
and make arrests for offenses involving the unlawful export of goods and technology to
destinations outside the United States.

2.

As a Special Agent with OEE, I am familiar with and have received training regarding

Federal laws relating to the unlawful export of goods and technology from the United States,
including but not limited to violations of Title 15, Code of Federal Regulations, Part 700-774
(Export Administration Regulations (EAR)); Title 50, United States Code, Sections 1701, et
seq. (the International Emergency Economic Powers Act (IEEPA)); 13 U.S.C. 305
(Submission of False or Misleading Export Information); 18 U.S.C. 554 (Smuggling Goods
from the United States); 18 U.S.C. 1343 (Wire Fraud); 18 U.S.C. 371 (Conspiracy) and 31
C.F.R. 560.203 and 204, the Iranian Transactions Sanctions Regulations (ITSR). I am also
familiar with related federal laws and the interpretation and application of federal laws and
federal court procedures, and I have previously conducted and assisted in the execution of
numerous federal search warrants. Moreover, I have conducted and participated in investigations
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of violations of United States laws relating to the unlawful export from the United States of
goods and technology restricted for export for reasons of national security and foreign policy.
II. PURPOSE
3.
I make this affidavit in support of an application pursuant to Fed. R. Crim. P. 41 for a
warrant to search the hotel room (#410) previously occupied by CHEE ONN CHEN at the
Renaissance Tampa International Plaza, FL as further described in Attachment A and to seize all
records, documents, data including data stored in electronic form and other tangible items
constituting the fruits, instrumentalities and/or evidence of violations of the federal export laws,
including Title 50, United States Code, Sections 1701, et seq. (IEEPA and the ITSR) principally,
31 C.F.R. 560.203 and 560. 204; (b) 13 U.S.C. 305 (Submission of False or Misleading
Export Information); (c) 18 U.S.C. 554 (Smuggling); (d) 18 U.S.C. 1343 (Wire Fraud); and
(e) 18 U.S.C 371 (Conspiracy), as further described in Attachment B. Specifically, based on
the information contained in this Affidavit, I submit that there is probable cause to believe that in
the hotel room previously occupied by CHEN there will be evidence that CHEN and CHUA,
alone and/or with others, have caused the unlawful export of United States origin computer
storage hardware and software to Iran via Malaysia and other countries, and used commercial
wires including electronic means of communications to carry out these acts in violation of
various laws and regulations of the United State as described above.

4.

The statements contained in this affidavit are based on information I have learned through

my personal participation in this investigation; from records, documents, and other evidence
obtained during the course of the investigation; from oral and written reports of other law
enforcement officers who are involved in this investigation and who have expertise and
experience in the investigation of the violations described above; and from my experience
and training as a OEE Special Agent. As this affidavit is being submitted for the limited purpose
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of obtaining a search warrant, I have not included each and every fact known to me concerning
this investigation, but instead have set forth only those facts that I believe are necessary to establish
probable cause that evidence of the violations described above will be found in the room
previously occupied by CHEN.

5.

III. THE APPLICABLE LAW AND REGULATIONS

IEEPA, 50 U.S.C. 1701-1706, authorizes the President of the United States (the

President) to impose economic sanctions on a foreign country in response to an unusual or

extraordinary threat to the national security, foreign policy or economy of the United States when
the President declares a national emergency with respect to that threat. Pursuant to the authority
under the IEEPA, the President and the Executive Branch have issued orders and regulations
governing and prohibiting certain transactions with Iran by U.S. persons or involving U.S.-origin
goods.
6.

Beginning with Executive Order No. 12170, issued on November 14, 1979, the President

found that the situation in Iran constitutes an unusual and extraordinary threat to the national
security, foreign policy and economy of the United States and declare[d] a national emergency to
deal with that threat.
7.

On May 6, 1995, the President issued Executive Order No. 12959, adopting and

continuing Executive Order No. 12170 (collectively, the Executive Orders), and prohibiting,
among other things, the exportation, reexportation, sale, or supply, directly or indirectly, to Iran
of any goods, technology, or services from the U.S. or by a U.S. person. The Executive Orders
authorized the U.S. Secretary of the Treasury to promulgate rules and regulations necessary to
carry out the Executive Orders.

Pursuant to this authority, the Secretary of the Treasury

promulgated the ITSR implementing the sanctions imposed by the Executive Orders.

8.

The ITSR generally prohibits any person from exporting or causing to be exported from

the U.S. any goods or technology without having first obtained an export license from the U.S.
Department of the Treasury, Office of Foreign Assets Control (OFAC).
9.

The regulations further prohibit any transactions evading or avoiding the Iran Embargo,

including the exportation of goods from the United States to a third country if the goods are
intended for or destined to Iran. A violation of the United States-Iran Embargo is a federal
felony offense punishable by up to twenty years imprisonment. See 50 U.S.C. 1705(c) and 31
C.F.R. 560.204.
10.

The U.S. Department of Commerce (DOC) also has the authority to regulate the

exportation of goods and technology from the United States to foreign countries. The DOC has
issued the EAR, controlling the export of goods and technology to Iran.

Under both the

Department of Treasury and the DOC regulations, any individual must file an application for a
license and receive approval from the OFAC and/or DOC to export or attempt to export any
goods, technology, or services from the United States to Iran. To date, no license application has
been received from and no license has been issued to CHEN, CHUA, or their respective
companies, SPRINGWORKS SDN BHD (SPRINGWORKS), FABER CAPITAL SDN BHD
(FABER), PASPALUM CAPITAL SDN BHD (PASPALUM), EASTREX LOGISTICS SDN
BHD (EASTREX), and/or SFS GLOBAL LOGISTICS SDN BHD (SFS).
IV. PROBABLE CAUSE
11.

DOC and HSI have been conducting an ongoing investigation into the procurement of

United States commodities by networks of individuals and entities in Iran. The investigation has
revealed that some of these networks of individuals and entities 2are affiliated with or
conducting business on behalf of companies located in Iran, the UAE, and Malaysia.
Investigators have determined that this network has acquired or attempted to acquire
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sophisticated, Enterprise Level computers and software, possibly for use in Irans
telecommunication infrastructure, or other unverified uses, from the United States in violation of
the United States embargo against Iran. The investigation has also revealed that the subjects of
this affidavit, CHEN, through his companies, SPRINGWORKS, FABER, and PASPALUM, and
CHUA through the freight forwarding/logistics companies he works for, EASTREX and SFS,
have been acquiring and diverting United States origin items to Iran via Malaysia and the UAE,
with the knowledge that doing so is illegal.

12.

Evidence obtained during this investigation revealed that between July 2012 and present,

CHEN purchased numerous Enterprise Level high end computer storage hardware systems from
various United States based manufacturers and exported them to Iran via Malaysia and other
countries for use by Iranian end-users Mahmood Akbari, doing business as (DBA) PATCO,
PATSA and ARYA HAMRAH SAMANEH (AHS) and Afshar AL GHASEMI DBA
THINKWARE SOLUTIONS and TRAVIZIA. Enterprise Level is an industry term indicating
that the equipment is suitable for an enterprise, such as a medium to large company, a
university or a government agency. The system has a very high storage capacity, performance
and redundancy and could be used in any application that requires quick access to a large amount
of stored data, including, but not limited to, the telecommunications industry or a defense
program. For many of those shipments, CHEN utilized the services of CHUA and EASTREX
and SFS, the freight forwarding companies he works for in Malaysia.

13.

During this investigation, United States Magistrates in the Middle District of Florida,

Tampa Division, issued numerous search warrants on both physical locations in Tampa, FL, and
e-mail accounts utilized by Akbari, CHEN, and other co-conspirators.

14.

Based on the evidence obtained from these search warrants, it is evident that CHEN and

Akbari were aware of the United States Iranian embargo, the issues it was causing CHEN in
procuring and supplying United States-based high-end computer equipment such as HDS, Sun
Oracle, and HP products, to Iran and the need to circumvent the embargo.

15.

Investigators also determined CHEN was utilizing Telekom Malaysia (TM) as a straw

purchaser to obtain HP equipment at a significant discount under HPs Big Deal program. This
discount provides a significant reduction in price from the manufacturers suggested retail price
(MSRP), not available to the average person. This discount is provided to customers based on
some or all of a variety of factors to include, but not limited to, sales volume, marketplace
competition, anticipated support and service contracts and the likelihood of additional, future
sales. HP was repeatedly informed that the goods were for use by TM in Malaysia.

16.

From October 2014 through January 2015 HSI Special Agents acting in an undercover

capacity (UCAs) negotiated deals for U.S.-origin Enterprise Level computer equipment. CHEN
provided a purchase order for $242,000 worth of EMC equipment and $827,500 worth of HP
equipment and provided a 10 percent down payment for the goods. CHEN and the UCAs agreed
the balance of 90 percent would be due upon inspection in Tampa, Florida.

17.

On November 28, 2014, the UCAs e-mailed CHEN, Subject HP Quote, the e-mail

stated, We haven't discussed your customer but we are getting the HP big deal pricing based on
a U.S.-based end user. We can work out the details if your customer requires remote support. I
apologize about the holiday and all, but I'm sure we can come to terms on this and other
business.

18.

CHEN and CHUA purchased their own airplane tickets to Florida, and arrived in the

Middle District of Florida on January 9, 2015 to inspect the equipment and prepare it for export.
During recorded meetings with the UCAs, CHEN indicated that he has been supplying computer
equipment to Iranian Mahmood Akbari. In addition, CHEN indicated in CHUAs presence that a
portion of the equipment that he and CHUA are attempting to export would be shipped to Iran.

19.

On January 12, 2015, CHEN, CHUA and a third individual later identified as a Miami-

based freight forwarder hired by CHUA, met with HSI UCAs at a Tampa, FL restaurant. After
lunch, CHEN, CHUA, and the Miami freight forwarder went to the HSI UC business (UCB) to
inspect the EMC and HP shipments.

The UC warehouse was wired for audio and video

recording. CHEN, CHUA and the freight forwarder engaged in small talk with the UCAs and
toured the warehouse, which contained boxes of EMC and HP equipment. Later, the UCAs and
CHEN met privately and discussed CHEN wiring the balance of the payment for the EMC
portion of the shipment. The UCAs engaged CHEN regarding the end-use of the items and he
stated the shipments are being used in the banking industry in Malaysia. The UCAs asked
CHEN to complete a BIS form 711, STATEMENT BY ULTIMATE CONSIGNEE AND
PURCHASER also used as an end-user certificate for the shipments being sold by the UCAs.
Several times before CHEN completed this form, the UCA stated he was only getting the "Big
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Deal Discount from HP due to the fact that HP believed the items were for use by the UCB in
the United States. CHEN asked the UCAs to confirm that the BIS form 711was not for HP,
because it would be a problem. The UC also asked CHEN why he needed to access the EMC
Service Portal using the UC company access. CHEN stated that UCB equipment should be
accessed via a UCB login, otherwise it would alert EMC. CHEN completed the BIS form 711
listing FABER in Kuala Lumpur, Malaysia as the Ultimate Consignee stating it will be used by
FABER in Malaysia and not re-exported from Malaysia. CHEN stated the Nature of FABER's
business is IT Software and Hardware. CHEN signed and dated the Ultimate Consignee portion
listing the date as January 12, 2015 and signed as the Ultimate Consignee listing himself as a
Director, listing the date as January 14, 2015. CHEN printed his name as CHEN CHEE ONN.

20.

On January 13, 2015, CHEN and CHUA met with the HSI UCA at the Renaissance

Tampa International Plaza hotel, though CHUA did not participate in the entire meeting. The
UCA engaged CHEN using audio recording, and discussed the EMC and HP deals. The UCA
inquired about Akbari, and CHEN stated that he does business with Akbari and knows that
Akbari is in Iran, and he ships items to Akbari in Iran. CHEN further admitted that a portion of
the current transaction involving EMC/HP equipment is going to Iran. CHEN further indicated
CHUA is fully aware of his dealings with Akbari, and arranges the shipments to Akbari in Iran as
well as his other shipments. CHEN also stated he has been dealing with Iran for at least 10
years, and knows many ways to get goods to Iran. The UC inquired about future deals to Akbari
in Iran, and CHEN agreed there was business to be done and all could make money. CHEN later
stated the balance of the wire for the EMC deal would be wired today or tomorrow. The UC
reiterated that if the money doesn't transfer the items would be returned to the supplier.

21.

On January 14, 2015 CHEN and CHUA again visited the UC warehouse to meet with the

UC agents and further inspect the HP and EMC merchandise. During this meeting, the UCAs
engaged CHEN and CHUA in discussions about Iran and the HP Big Deal discount. CHUA
indicated there are more flights between Malaysia and Iran than between Jordan and Iran. The
UCAs indicated without the Big Deal discount the transaction would cost approximately $1.3
million dollars. CHEN also indicated he recently received a quote for equipment from Akbari.
CHEN was observed utilizing his laptop computer which he retrieved from a red backpack he
brought with him, as well as his mobile phone. CHEN forwarded emails and attachments to the
UCA email account so that these messages and/or attachments could be printed.

22.

On January 14, 2015, United States Magistrate Judge Thomas G. Wilson issued two

separate arrest warrants based on a criminal complaint (Case No. 8:15-MJ-1031-TGW) for the
arrest of CHEN ONN CHEE and the arrest of KENNETH CHUA WEI XIAN.

23.

On or about January 15, 2015, CHEN caused approximately $217,800 to be wired from

outside the United States into the UCBs account in Tampa, Florida, as the final payment (90%)
for the EMC goods to be purchased. On January 15, 2015 investigators arrested both CHEN and
CHUA; both made incriminating statements to investigators after being advised of their Miranda
rights and signing a rights waiver form. After these interviews CHEN and CHUA appeared
before United States Magistrate Judge Thomas G. Wilson, for arraignment and initial
appearance. Both individuals were held on immigration detention pending preliminary hearings
scheduled for January 21, 2015 before United States Magistrate Judge Thomas G. Wilson.

24.

CHENs only known residence during this visit to the U.S. was room number #410 at the

Tampa Renaissance International Plaza, in Tampa, Florida. In addition, at the time of CHENs
arrest, he only had a backpack with him, and he advised law enforcement officers that all of his
belongings were still in the hotel room.

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CONCLUSION
25.

Based on the foregoing, I believe there is probable cause that evidence, fruits and/or

instrumentalities of the crimes of violations of the federal export laws, including Title 50, United
States Code, Sections 1701, et seq. (IEEPA and the ITSR) principally, 31 C.F.R. 560.203
and 560.204; (b) 13 U.S.C. 305 (Submission of False or Misleading Export Information); (c)
Title 18, United States Code, Section 554 (Smuggling); (d) Title 18, United States Code, Section
1343 (Wire Fraud); and (e) Title 18, United States Code, Section 371 (Conspiracy), are located in
the suitcases and personal effects located in CHENs hotel room at the Tampa Renaissance
International Plaza hotel, which was paid for by the UCB, in whatever form they are found, as
more fully described in Attachments A and B to this Affidavit. I therefore request that the court
issue a warrant authorizing a search of the room more fully described in Attachment A, and the
seizure of any such items described in Attachment B.

____________________________________
ALAN G. BERKOWITZ SPECIAL AGENT
United States Department of Commerce
Bureau of Industry and Security
Office of Export Enforcement

Sworn to and subscribed before me

On this _____ day of January 2015

___________________________________
THOMAS G. WILSON
UNITED STATES MAGISTRATE JUDGE

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