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Pair of seed theft suspects in custody, face trial this fall

 

By JIM RUTLEDGE

D.C. Correspondent

 

DES MOINES, Iowa — Two Chinese business associates – including the wife of the billionaire founder and chair of one of China’s largest conglomerates who allegedly led a double life as the leader of a Midwest agricultural espionage ring – face trial in September on conspiracy charges for stealing hundreds of specially modified and designed hybrid corn seeds from Iowa and Illinois farm fields.

Under house arrest in an undisclosed Des Moines location and monitored by the FBI around the clock, 43-year-old Mo Yun and her brother, 46-year-old Mo Hailong – also director of international business for Yun’s husband’s business – huddle daily with a team of defense attorneys trying to keep their clients from serving long federal prison sentences and fines of up to millions of dollars.

The two suspects have pled not guilty and trial is set for Sept. 14 before Judge Stephanie M. Rose, of the U.S. District Court for the Southern District of Iowa. Mo Yun and Mo Hailong were arrested last July, following a 24-page indictment accusing them and five others of a five-year conspiracy involving stashing hundreds of stolen corn seeds and corn products in a series of storage locker locations around the Midwest in an attempt to hide them from investigators.

All of the suspects are believed to have been working at the direction of the Beijing Kings Nower Seed S&T Co. Ltd. (BKNS), one of 67 different subsidiary companies owned and managed by Beijing Dabeinong Technology Group Company, DBN. Mo Yun’s husband, Dr. Shao Genhuo, is chair of the DBN.

Also named in the indictment but escaping to China before they could be arrested were 49-year-old Li Shaoming, the chief operating officer for BKNS; 53-year-old Wang Lei, vice chair of BKNS; 46-year-old Wang Hongwei of Canada; 39-year old Lin Yong, an employee of BKNS; and 34-year-old Ye Jian, a BKNS research manager.

BKNS produces and sells seeds under its Jin se Nong Hua Co., Ltd, label. All the defendants were born in China and working in the United States on business and tourist visas.

Mo Hailong, also known as Robert Mo, is a legal resident of Boca Raton, Fla., and Mo Yun is a resident of Beijing, where DBN is based. This is the largest alleged agricultural espionage ring uncovered in the United States.

The indictment reads like a Hollywood spy thriller, with extensive around-the-clock wire taps at various locations and in the suspects’ vehicles, daily surveillance by teams of FBI agents and secretly recorded photographs of the suspects meeting and handling allegedly stolen corn seeds.

During the investigation, the suspects were alleged to have shipped, undetected, hundreds of small bags of various types of seeds produced by three of the nation’s largest producers of corn products, dug up from nearly a half dozen of the companies’ fields in Iowa and Illinois.

The espionage ring was allegedly led by Mo Yun, who the FBI stated was on a secret spying mission to obtain "1,000 pieces of the top-notch corn hybrids or inbred lines currently available in the U.S. It’s even better if we can collect the elite breeds that are being tested," one of the defendants is heard telling a co-conspirator in secret wire taps.

The targets of the conspiracy and the thefts were the country’s top developers of inbred corn seeds: Pioneer Hi-Bred, a division of DuPont, Monsanto and LG Seeds.

This espionage ring allegedly ran the illegal operation out of a farmhouse on 40 acres of farmland that included a private residence and several outbuildings owned by the company, Kings Nower North America (KNNA).

The farm property is located at 104th Avenue in Monee, Ill. The property was purchased for $600,000 by Mo Hailong on behalf of the company’s parent, BKNS. The company also operated an office suite in Naperville, Ill.

Upon the arrest of the two siblings, the FBI seized the farmlands and office site and will seek forfeiture of the property, including a parcel of land near Redfield, Iowa, upon conclusion of the trial. The seized property is monitored daily by the FBI.

On various occasions, according to the indictment, several of the defendants were seen digging up the specialty seeds developed during the corn breeding process of germplasm, which the indictment said was intellectual property exclusively belonging to the U.S. companies.

The corn seeds were dug up on fields owned by Pioneer Hi-Bred near Harmon, Ill., a field owned and planted by LG Seeds near Manito, Ill., and four fields owned and operated by Monsanto near the Illinois towns of Foosland, Dewey, Rantoul and Fairmount.

To conceal the thefts, various teams of the defendants allegedly stored hundreds of pounds of corn seeds and corn products in storage lockers in Adel, Iowa, and New Lenox, Ill., all discovered and raided by the FBI. The seeds were later allegedly transported to the company-owned farmhouse in Monee and prepared for clandestine shipment to China.

In an affidavit FBI agent Mark Betten filed in the case, he said one inbred seed line developed by Monsanto and targeted by the defendants took 5-8 years of research and cost the company upwards of $40 million to develop. Stealing that technology could eventually cost Monsanto double or triple its development costs in lost revenue if illegally produced and sold to the marketplace.

Each of the suspects have been charged with one count of conspiracy to steal trade secrets. If convicted, they face long prison terms and fines up to a $1 million or more.

4/15/2015