Chinese National Pleads Guilty to Conspiring to Steal Trade Secrets

Children of the Corn

Children of the Corn

The Chinese Corn Case has surfaced again:

(DOJ) Mo Hailong, aka Robert Mo, 46, pleaded guilty today to conspiracy to steal trade secrets before U.S. District Judge Stephanie M. Rose of the Southern District of Iowa, announced Assistant Attorney General for National Security John P. Carlin and Acting U.S. Attorney Kevin E. VanderSchel of the Southern District of Iowa.

According to the plea agreement, Hailong admitted to participating in long-term conspiracy to steal trade secrets from DuPont Pioneer and Monsanto.  Hailong further admitted to participating in the theft of inbred – or parent – corn seeds from fields in the Southern District of Iowa for the purpose of transporting those seeds to China.  The stolen inbred seeds constitute the valuable intellectual property of DuPont Pioneer and Monsanto.

During the conspiracy, Hailong was employed as director of international business of the Beijing Dabeinong Technology Group Company, a Chinese conglomerate with a corn seed subsidiary company, Kings Nower Seed.  Hailong is a Chinese national who became a lawful permanent resident of the United States pursuant to an H-1B visa.

Hailong is scheduled to be sentenced at a date to be determined later in Des Moines, Iowa.  Conspiracy to steal trade secrets is a felony that carries a maximum sentence of 10 years in prison and a maximum fine of $250,000.  As part of Hailong’s plea agreement, the government has agreed not to seek a prison sentence exceeding five years.

The investigation was initiated when DuPont Pioneer security staff detected suspicious activity and alerted the FBI.  DuPont Pioneer and Monsanto have fully cooperated throughout the investigation.  The case is being investigated by the FBI.  The case is being prosecuted by the U.S. Attorney’s Office of the Southern District of Iowa and the National Security Division’s Counterintelligence and Export Control Section.

Hailong Plea Agreement

Chinese businessman gets deal in seed theft case (Des Moines Register)

A Chinese businessman accused of stealing valuable patented corn seeds from Iowa farm fields has cut a deal with prosecutors in hopes of shortening his possible prison sentence.

Mo Hailong pleaded guilty Wednesday at the federal courthouse in Des Moines to one count of conspiracy to steal trade secrets from DuPont Pioneer and Monsanto as part of a scheme to send genetically modified seeds to his employer in China, an agriculture conglomerate called the Beijing Dabeinong Technology Group Co.

The case came amid what the FBI says is a rise in Chinese companies targeting patented U.S. seeds so they can counterfeit them without paying for their own research and development — costing U.S. companies billions of dollars.

Mo, a lawful permanent resident who also goes by the name Robert Mo, first came under suspicion in 2011 when a DuPont Pioneer field manager found him nervously digging in one of the company’s test fields.

The FBI investigation followed and in September 2011, the FBI intercepted a box labeled “corn seeds” that Mo had mailed to his home in Florida from West Des Moines. Agents in February 2012 collected surveillance video showing Mo used a fake identity and company name to join a group of Chinese delegates on a tour of DuPont Pioneer’s company headquarters. . . . (read more)

The defendants

Prosecutors with the U.S. Attorney’s Office for the Southern District of Iowa indicted seven Chinese citizens allegedly involved in a seed-stealing plot on behalf of DBN Group. Only two siblings, Mo Hailong and Mo Yun, faced prosecution. The other five are believed to have left the United States. The information that follows is according to court documents.

  • Mo Hailong: Investigators believe Mo worked as the director of international business for DBN Group. He is a lawful permanent resident of the United States, with a house in Boca Raton, Florida. The FBI’s investigation into the seed-stealing plot began in 2011, after a DuPont Pioneer field manager found Mo nervously digging in one of the company’s test fields.
  • Mo Yun: Mo is married to Dr. Shao Genhuo, the billionaire CEO of DBN Group. Prosecutors believe from text messages that she was involved in the seed-stealing plot, at least during 2007 and 2008 while she led a DBN Group research division. Mo was arrested last year while visiting the United States with her two children.
  • Li Shaoming: Li is believed to be the chief operating officer of Kings Nower Seed, a DBN Group subsidiary.
  • Wang Lei: Wang is believed to be the vice chairman of Kings Nower Seed.
  • Wang Hongwei: Wang was seen by the FBI moving boxes at an Illinois farm purchased by Kings Nower Seed. Wang was caught at the U.S.-Canada border with 44 bags hidden in a vehicle that contained corn kernels and a digital camera with photos of Monsanto and Pioneer production facilities.
  • Ye Jian: Ye is believed to be a researcher for Kings Nower Seed. In August 2012, the FBI put a bug in a rental car driven by Ye and another employee, Lin Yong. Agents caught the two talking about the seed-stealing plot, including Ye saying, “You can forget about ever coming to the U.S. again, assuming things go wrong.”
  • Lin Yong: Investigators captured Lin, a Kings Nower Seed employee, in a conversation with Ye Jian, that included Lin saying, “These are actually very serious offenses.”