An active-duty U.S. Navy Lieutenant has not joined his three co-conspirators in pleading guilty to the charges of violating U.S. export laws as part of a conspiracy to purchase and export U.S. manufactured vessels, with dual-use applications (both civilian and military) to the Peoples Republic of China (China). This may be because he is also charged with providing false information as part of his background investigation and lying to his command, and thus he has not been offered the “deal” which his co-defendants enjoyed.
Lieutenant Fan Yang
Lieutenant Fan Yang is a naturalized U.S. citizen (born in China in 1985, emigrated to the U.S. in 1999, and became U.S. citizen in 2006). Yang served in the U.S. Navy from 2005-2007 and after attending college and acquiring a bachelor’s degree in electrical engineering, re-enlisted in the Navy in 2012 to attend Officer Candidate School, followed by flight school. Yang holds a Top Secret national security clearance and is assigned to the Maritime Patrol Reconnaissance Weapons School at Naval Air Station Jacksonville (Florida).
- Yang Yang – One of the co-defendant’s is Fan Yang’s spouse, Yang Yang, who was also born in China in 1985, emigrated to the U.S. in 2013 and married Fan Yang. She became a U.S. citizen in 2016.
- Ge Songtao – Ge is the chairman of Shanghai Breeze Technology, a company located in Shanghai. Ge traveled to the U.S. on a current business visa (B1/B2). He is a PRC citizen. During his travels to the U.S. he sought out specialized weapons training by hiring U.S. based firearms and tactical instructors with prior military experience. A confidential source advised that Ge had requested a copy of the U.S. Navy “OPNAV 3591 Small Arms Training and Qualifications Instruction” (unclassified) from which the source had based the training provided to Ge.
- Zheng Yan – Is an employee of Ge’s. She has traveled to the U.S. on numerous occasions. She too is a PRC citizen. Zheng was an active participant in the attempt to acquire U.S. “raiding” boats.
FAMILY YANG’s Commercial engagements
Fan Yang and Yang Yang created a Florida LLC, BQ Tree in May 2015. For the years 2015-2019, they filed annual reports with the Florida Secretary of State. On September 25, 2020, the LLC was declared inactive by the Secretary of State and administratively dissolved. Fan gave himself the title Chief Consultant and Yang was given the title Consultant. From November 2016 through August 2019, BQ Tree received approximately $205,270 in wire transfers from Shanghai Breeze.
Undeclared Foreign Contacts
Fan Yang dug himself a hole when, according to court documents, he attempted to hide from the Navy his relationship with Ge and Shanghai Breeze Technology.
Request for liberty
When one is on active duty, a request for leave must be truthful, and his NAVPERS 1336/3 request for time off indicated he would be taking his family to Disney from July 12-16, 2018 proved to be false. Instead, he and Yang Yang traveled to Sioux City, Iowa and met with Ge and Zheng.
Fan Yang submitted an updated questionnaire for his renewal of his Top Secret national security clearance. He noted that he had no undeclared relationship with foreign nationals. In the section concerning foreign financial interests, he declared that neither he or his spouse had foreign financial interests. Similarly, he dissembled on the portion of the form which asked about engaging in commerce on behalf of or with a foreign entity. This activity is described in count three of the October 31, 2019 indictment.
Lies Came to the Light – One by One
Fan Yang’s untruths were systematically uncovered one by one during the joint FBI – Naval Investigative Service investigation.
A lawful search and surveillance of his email account noted an exchange of approximately 400 emails between Ge and Yang Yang during the period November 2016 through September 2019. The emails between the two used the email address associated with Fan Yang via BQ Tree.
Law enforcement search and surveillance revealed Yang Yang was a contract employee of Shanghai Breeze. One of those emails, on November 10, 2016, comprised an employment contract where Yang Yang would be paid $3000/month by Shanghai Breeze, increasing to $5000/month following a one to three month probationary period. His duties were to “handle business operations, conduct business negotiations, collaborate with other factories, declare products at customs and conduct other similar business for Shanghai Breeze Technology Co., Ltd. in the United States.”
Additional investigative action showed that Fan Yang provided Chinese national Huang Hua power of attorney over his Bank of China accounts. Thus with a copy of the power of attorney, it became evident that a Bank of China account owned by Fan Yang existed, and was not declared during the reinvestigation process.
Fan Yang purchased, and then stored a fire arm on behalf of Ge. Ge paid him to purchase the fire arm (Sig Sauer MK25 P226 9mm pistol) and store it during the period of time that Ge was not in the United States. This activity is detailed in counts one and two of the indictment of October 31, 2019.
Exporting dual-use dinghies
Shanghai Breeze had made numerous attempts to vessels and engines for export to China without any joy. At Ge’s request, BQ Tree served as the intermediary, or front for Shanghai Breeze in the acquisition of seven vessels and eight engines. In addition, fictitious shipping addresses and end users located in Hong Kong were created to conceal the export of the vessels/engines were actually heading to China.
Where are they now?
Yang Yang, who pleaded guilty to two charges on which she was indicted, was sentenced on December 9 to “time served” (14-months). Both Ge and Zhang have also pleaded guilty and are awaiting sentencing. Fan Yang’s trial is scheduled to begin in March 2021.