Only in recent months did the full scope of the ruse become apparent. The destination for the specialty steel was not China but Iran, and the order had nothing to do with toy horses, U.S. investigators say.
“We are certain,” said a law enforcement official familiar with the case, “that the metal was meant for advanced centrifuges in Iran’s nuclear program.”
Last month, the Justice Department announced indictments against two people, one Chinese and the other Iranian, for conspiring to acquire maraging steel and other restricted American technology. U.S. officials say the case is part of a broader effort by Iran to dramatically expand its capacity to enrich uranium — with Chinese firms serving as willing accomplices.
The United States and its European allies have imposed ever-escalating sanctions intended to cut off Iran from sensitive technology and restricted material required for its nuclear program and to reduce its access to the global oil market. The goal is to stop Iran’s progress toward what the West believes is a nuclear arsenal, even as Iran maintains that its nuclear efforts are strictly part of a civilian energy program.
Maraging steel is a critical material in a new, highly efficient centrifuge that Iran has struggled for years to build. Barred by sanctions from buying the alloy legally, Iranian nuclear officials have sought to secretly acquire it from Western companies. In recent years, U.S. officials say, an increasing number of Chinese merchants have volunteered to help, serving as middlemen in elaborate schemes to obtain the steel and other forbidden material for Iran’s uranium enrichment plants as well as its missiles factories.
“They are not just stumbling on opportunities,” said Steve Pelak, the Justice Department's counterespionage chief. “They are professional, studied procurement agents and shippers. They know precisely what business they’re in and how to go after it.”
The Seattle case is at least the fourth in the past two years in which companies based in China have been accused of helping Iran try to purchase sensitive technology. Although Iran has used Chinese go-betweens in the past, U.S. officials said sanctions have forced the isolated and besieged Iranian government to rely increasingly on China for economic help and access to restricted goods.
A senior Justice Department official, speaking on the condition of anonymity to discuss ongoing investigations, said, “As some countries have retreated from the Iranian market with the imposition of increased sanctions, many Chinese companies appear to have moved into the void.”