Ashley Yablon, the former general counsel of ZTE Corporation of America, has published a new book looking back at his disclosure to the FBI about ZTE's violation of the U.S. embargo on Iran 10 years ago. Ablon told VOA that he paid a heavy price for reporting ZTE. He also expects that ZTE may violate international embargo sanctions driven by interests in the future.
In October 2011, Yabulong, who was less than 40 years old, became the general counsel of ZTE US, a Chinese telecom equipment maker. Previously, he served as Deputy General Counsel at Huawei USA. According to Yabloon, at ZTE, he oversees the company's legal affairs in four areas: contracts, personnel, compliance and litigation.
"All investigations on ZTE began in November 2011, when the House Intelligence Committee felt that ZTE and my former employer, Huawei, were a threat to U.S. national security," Yabloon told VOA in a video interview.
"We all have dreams, we all have ambitions, and I certainly have," Yablon said. "Being general counsel is my dream career, it's something I've always wanted."
But looking back on a decade of "dream come true", Yablon now believes that ZTE, which has been selling embargoed items to countries sanctioned by the United States such as Iran and North Korea, hired him as the US general counsel in the first place to When the unidentified incident happened, all the blame was "thrown" on this American.
The day before Thanksgiving in the United States in 2011, ZTE America held an emergency meeting. "At ZTE (a US company), 80% of the office staff are Chinese citizens with visas. So only 20% of the entire office is US staff... I was just hired a month ago. All the executives participated in this The meeting...is all Chinese, except me."
Yabloon said the Thanksgiving meeting discussed the news that the U.S. House of Representatives had launched an investigation into Huawei and ZTE.
"They turned to me and said what should we do? I said, we need to find a lobbying firm to help us with the congressional investigation. They said, well, you go find us five firms, and we'll pick one. I said Okay. But what this red flag means is that they want to make it clear that they are actually asking me to say they did nothing wrong. So this should have been a real warning: when we're going to hire a lawyer At the firm, they wanted me, an American, to stand up and say they did nothing wrong."
The "Thanksgiving meeting" was just one of many red flags sent by ZTE. According to Yabloon's testimony to the US FBI, in the fall of 2011, ZTE headquarters sent him three assistants from China to deal with the US investigation. "They are all Chinese lawyers who don't have U.S. licenses and can't practice in the U.S., but they came here to help me," Yabloon told VOA.
Just when ZTE was struggling to deal with the investigation by the US Congress, on March 22, 2012, Reuters released heavy news, reporting that ZTE was suspected of violating the US embargo and reached a $130.6 million deal with Telecommunications Iran (TCI). Network communication equipment sales contract. An internal ZTE shipping bill of more than 900 pages shows that this batch of equipment includes software and hardware products from American technology companies such as Microsoft, HP, Oracle, Cisco, Dell, and Symantec. Iran uses these devices to monitor its people.
As soon as the Reuters report came out, the U.S. Department of Commerce’s Export Administration immediately issued an administrative subpoena to ZTE America on March 23, requesting to review ZTE’s contracts and shipment records with the Iranian company.
Yabulong said: "They (Chinese lawyers) are very busy and everyone is worried. I asked one of them and I said why are you so worried about how they (the media) got (information), we should be more concerned. What do we need to do."
"Because now we can't hide anything," the Chinese lawyer, whose English name is "Marsha", told Yabulong.
"If you think about it, 'we can't hide'," Ablon lamented. To me, that should have been a real warning—they were doing something illegal."
In April 2012, Yabulong went to the Shenzhen headquarters of ZTE, with the purpose of checking the Iranian freight bill with his own eyes.
"I was taken to ZTE's campus, a very large campus, where I was taken to the first floor of a building that was vacant, and there was no one in it, and I was taken to a room with no windows. There was a man sitting at a table there. In the back, in front of him is a computer and a projector. It's dark in the room and he says...you can't watch the contract, but I'll show you 15 minutes on the screen. So I have 15 minutes to watch this a contract," he said.
"The contract was split in half, half in Chinese and the other half in English. But when I scrolled up and down the contract, I saw a section with the English title 'How will we get around US export laws' ( How We Will Get Around US Export Laws).”
This part of the contract details the process by which ZTE will resell the banned items indirectly to Iran by setting up front companies, buying equipment from U.S. manufacturers, Yabloon said.
He said that ZTE executives threw him a number of "ideas" to try to confuse the U.S. government's investigation: lie to the U.S. government, deny actual shipments to Iran, or send people to Iran to dismantle U.S. components in telecommunications products.
Chinese lawyer "Marsha" told Yabulong that ZTE executives made a decision after consultation: destroy all the evidence records the US government requested to see, and then "they will make you swear by their lies that they did nothing wrong. ".
"In that moment, I had no choice but to be the whistleblower for reporting them because they were committing further crimes," Ablon said.
He explained: "This is not a crime that happened in the past that allowed me to keep it a secret based on attorney-client privilege. What they did was to commit further crimes in the future and wanted me to be a scapegoat. That's the problem. where."
ZTE Threats to Report Confession Leaked to FBI
"I don't see a reason for you not to go to the FBI and not be a whistleblower," a criminal lawyer hired by Yabloon told him. "When he said that, I realized what I needed to do, so I guess it was an easy decision to make, but it was the hardest thing I've ever done," Ablon said.
In May 2012, Ablon was interviewed by two FBI special agents. In his just-published book, Yabloon said he explained to the FBI how he discovered ZTE's illegal plans, detailed how ZTE set up a series of front companies to cover up its illegal activities, and listed two U.S. and Chinese companies. The name of the relevant person in the country.
"The FBI recorded my description in a detailed 32-page sworn statement," he wrote in the book. As they explained, one of the purposes of this sworn statement was to obtain the FBI's investigation of ZTE America Inc. Authorization to conduct a forensic search."
But what he did not expect was that the confession he provided to the FBI was leaked soon after. In July, the US news website "The Smoking Gun" published the content of the confession, and the identity of Yabulong's whistleblower was exposed.
He told VOA that he received "death threats" from ZTE. "I was stalked, my wife was stalked, all kinds of crazy things that you only see in movies happened to us, and things that didn't seem normal were going on," he said.
After deciding to sue ZTE, Yabulong said, he had to hire five lawyers, paying a total of six figures in legal fees, and went bankrupt.
"As you can imagine, when you are faced with the pressure of how to pay this money, I have spent all my savings, borrowed money from family and friends, and sold everything as I detail in the book. , in order to pay my lawyers."
He told VOA that reporting to the FBI and the subsequent leak of the confession caused him enormous physical and psychological stress. "You can also imagine, for married people, the stress that this puts on the marriage ... and the physical stress. I can't sleep."
Yabulong left ZTE America in April 2015. The whistleblower incident also affected Ablon's career. He said: "I've been out of work for two or three years. So I've been wondering if there's some kind of imprint on my name or there's a stigma -- 'Oh, we don't want that guy, he A whistleblower'; or, 'Oh my God, he worked for ZTE. We don't want to touch him, we don't want him to work for us, because all this bad press and everything about ZTE sucks.'"
Ablon currently resides in Plano, Texas, and is a legal counsel advising legal practitioners and corporations on trade matters.
Yabloon's new book, "Standing Up to China: How a Whistleblower Risked Everything for His Country," was published this month. Referring to the title of the new book, he told VOA: "In essence, I realized that I was not just fighting ZTE or Huawei, I was fighting China."
In 2017, ZTE reached a plea agreement and a settlement agreement with the U.S. government, agreeing to plead guilty and pay a criminal and civil fine of $892 million and a suspended fine of $300 million for the alleged illegal export, misrepresentation and other acts. The suspension of fines means that if ZTE actually fulfills the agreement during the seven-year suspension period, it can be exempted from payment.
In 2018, the U.S. Department of Commerce accused ZTE of violating the settlement agreement, and ZTE admitted the penalty again, handing over a fine of $1 billion and a security deposit of $400 million. After deducting the outstanding $300 million in suspension fines, ZTE spent a total of $2.292 billion in fines, setting the highest fine imposed by the U.S. federal government on an export control violation case.
Just on March 22 this year, the U.S. District Court for the Northern District of Texas ruled that the probation period stipulated in the 2017 DOJ settlement agreement, that is, the probation period expires on the same day, without any penalty, should not be revoked. It means that ZTE has lifted a number of restrictive measures in the US sanctions, including restrictions and prohibitions on companies from applying for, using any licenses, or purchasing or selling any items exported from the US that are subject to US export control regulations.
FBI agents have previously testified that ZTE may have violated probation rules and was suspected of participating in visa fraud, and its former employees were accused of conspiring to bring Chinese nationals to ZTE laboratories in the United States for research work.
Ablon said he believes the Texas federal judge made the wrong decision. "I think ZTE will now feel emboldened to continue doing what they've done before in new ways."
When talking about whether ZTE would violate U.S. sanctions against Russia and export embargoed items to Russia, Yabloon said: "Do I think they (ZTE) have the ability to comply? Of course, they are a big company and very successful. , very profitable. But I don’t think they end up, whether it’s now, a year from now, or a few years from now, they just can’t help themselves.”
"My message is, be careful what you wish for, because you might get it," Yablon said.
"Unfortunately, there are so many red flags I don't see, they're so obvious... they're right in front of me and I don't see them. I think it's because I don't want to see it; I want to Believe the positive things about ZTE, about this great (job) opportunity."
VOA reporters sent a request for comment to ZTE America and ZTE's compliance director for the Americas, but had not received a response from either party as of press time.
On March 22, the communications industry information website Capacity Media published ZTE's response to Yabulong's new book. ZTE said: "Starting in 2018, when ZTE's new management team set the goal of making ZTE a global compliance leader, the company has made compliance the cornerstone of its strategic development and operations, and has provided the company proud of the significant improvement in our compliance program and culture.”