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FBI arrests leader of alleged plot to steal seed technology

 

 

By JIM RUTLEDGE

D.C. Correspondent

 

DES MOINES, Iowa — FBI agents have shut down what some say is the largest corporate agriculture espionage case in the country.

They have arrested the alleged ringleader, who secretly led a group of co-conspirators caught digging up corn seeds and stealing valuable high-tech seeds from two of the largest U.S.-based seed manufacturing companies, and shipping the corn products overseas to benefit their China-based seed company.

Federal agents arrested 42-year-old Mo Yun on July 1 in Los Angeles, following a multi-count indictment charging the suspected ringleader of stealing trade secrets from Iowa-based DuPont Pioneer, Missouri-based Monsanto and Indiana-based AG Reliant Genetics Seeds unit. All develop or farm cornfields across Illinois and Iowa. Mo Yun is charged with leading the conspiracy during the past five years.

Using secret court-ordered wire tapes on cell phones and bugging GPS devices on various suspects’ rental vehicles, the FBI had the team under surveillance since several Chinese men were found crawling in Midwest cornfields stealing corn ears and corn seeds. One of the bugged cars was driven by the CEO of the Chinese seed company Kings Nower Seed, the indictment said.

Mo Yun and several other suspects were employed by the Beijing Dabeinong Technology Group Co., known as the DNB Group, a conglomerate that owns seed businesses and its subsidiaries.

Mo Yun is the wife of DBN’s chair and founder, Dr. Shao Genhou, who is on Forbes’ list of global businesspeople with a net worth estimated at more than $1 billion.

According to federal authorities, Mo Yun is also the sister of co-conspirator Mo Hailong, also known as Robert Mo, the international business director of DNB. He was arrested seven months ago in Miami by the FBI and is being held without bond.

No charges have been filed against Shao or his companies but federal authorities say the investigation is continuing.

A spokesman for U.S. Attorney Nicholas Klienfeldt, of the Southern District of Iowa, declined to say if Mo Yun was in the country on a work visa or why she was in California. The indictments were returned by a federal grand jury for the U.S. District Court headed by Klienfeldt, in Des Moines.

Besides Mo Yun, six other Chinese nationals have been arrested and accused of stealing corn seeds and other information from Monsanto, Pioneer Hi-Bred and AG Reliant Genetics from production fields in the upper Midwest. The seeds and corn products were then shipped to Kings Nower Seed, a unit of the DBN Group, to benefit the Chinese company, according to the FBI.

Authorities say the investigation was launched when DuPont security staff detected suspicious activity at one of its cornfields, and observed a couple of men digging up corn seeds in an Iowa field and alerted local authorities and the FBI.

Spokesmen for Pioneer and Monsanto said they are cooperating with the FBI in the continuing investigation.

In May 2012, three of the six defendants attempted to ship approximately 250 pounds of corn seed, packaged in 42 five-gallon zip-lock bags contained in five separate boxes, from Illinois to Hong Kong, but the shipment was seized, according to the indictment.

Citing an email in the indictment, Mo Yun was allegedly in charge of "the specifics from the home country side" and was looking to gather 1,000 pieces of "top-notch corn hybrids or inbred lines currently available in the U.S." The indictment said Mo Hailong was mentioned in the emails and part of the alleged plot.

FBI Special Agent Thomas R. Metz, agent in charge of the Omaha Division of the FBI, said in a statement, "The FBI’s investigation into Mo Yun should not go unnoticed by those who seek to steal trade secrets and private business information. Identifying and deterring those focused on stealing trade secrets, propriety and confidential information or national security information is the No. 2 priority of the FBI, second only to terrorism."

An earlier indictment filed in December 2013 listed six men as part of the conspiracy. An updated indictment filed July 3 added Mo Yun and listed further details about the operation that agents discovered as early as January 2007. Beginning in 2001, the indictment said she was in charge of DBN Group’s research project management team until 2009.

Other suspects named in the indictments were Li Shaoming and Wang Lei, both executives of the Kings Nower subsidiary. They were in the United States on visitor visas. Also named were Ye Jian and Ling Yong, both residents of China, also employed by Kings Nower and also on visitor visas, and Canadian citizen and Quebec resident Wang Hongwei.

Prior to Mo Hailong’s arrest last December, FBI agents had been tracking him using GPS devices. He was discovered in an Iowa farm field Pioneer used to test corn seed products. At the time, the indictment said, the company was planning to bring to market the newly developed corn products. He was later discovered with two others in a Monsanto test seed field.

FBI agents found ears of corn stashed in an Illinois self-storage units, dozens of bags of corn kernels stuffed under the seat of a rented vehicle and hundreds of pictures of cornfields and production facilities. The indictment said the men planned to ship the seeds and materials to China.

Federal officials said the potential loss associated with the thefts was estimated between $30 million-$40 million and up to eight years of research time.

It could not be determined at press time if Mo Yun has an attorney. She was being held at federal detention facilities in Los Angeles.

The indictment explained inbred lines of corn seeds are genetically pure and uniform and are used by seed companies to create hybrids that are vigorous and high-yielding. Further, the indictment said because second-generation hybrid plants are less vigorous and lower-yielding, seed companies create new hybrid seeds every year from inbred lines to develop a new generation of corn products.

7/9/2014