Chinese National Charged in Scheme Involving U.S. Defense Data and Rare Earth Magnets

Highlights

• U.S. Department of Justice indicts Hang Sun for illegally exporting defense-related technical drawings to China between 2012-2018.
• Sun’s company, Quadrant Magnetics, allegedly supplied Chinese-origin rare earth magnets to U.S. military contractors in violation of DOD regulations.
• Facing up to 55 years in prison.
• The case underscores efforts to protect U.S. defense technologies from foreign exploitation.

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Last month, the U.S. Department of Justice charged Hang Sun, also known as Cody Sun, a Chinese national and U.S. legal permanent resident, in a four-count indictment for conspiracy, wire fraud, smuggling, and violating the Arms Export Control Act. The indictment alleges that Sun illegally exported sensitive defense-related technical data to China and sold rare earth magnets of Chinese origin to the Department of Defense (DOD) violating federal regulations.

Between 2012 and 2018, Sun is accused of sending approximately 70 export-controlled technical drawings—related to defense systems such as aviation, submarines, and missiles—to a Chinese company without proper U.S. authorization. Additionally, rare earth magnets smelted and magnetized in China were allegedly supplied by Quadrant Magnetics, a company connected to Sun, to U.S. contractors who used them in military equipment like F-16 and F-18 aircraft, violating DOD acquisition rules requiring magnets to originate from approved countries.

The U.S. Department of Justice issued the press release (opens in a new tab) last month.

If convicted, Sun faces up to 55 years in prison for the charges. Multiple federal agencies, including the FBI, IRS Criminal Investigation, and Defense Criminal Investigative Service are handling the case. The indictment highlights ongoing efforts to protect U.S. defense technologies and supply chains from foreign exploitation.

All defendants are presumed innocent until proven guilty in a court of law.