Two Canadians indicted in U.S. over alleged smuggling scheme to aid Pakistan nuclear program

In this Thursday, April 18, 2019, file photo, a sign for the Department of Justice hangs in the press briefing room at the Justice Department, in Washington. (AP Photo/Patrick Semansky, File)

TORONTO — Two Mississauga, Ont., men have been indicted in U.S. federal court for allegedly helping to run an international smuggling procurement scheme over a five-year period to support Pakistan’s nuclear program.

Muhammad Ahsan Wali, 48, and Haji Wali Muhammad Sheikh, 82, were two of five men accused of running the procurement scheme for things such as aircraft parts, sensors and satellite communications devices using an alleged front company called “Business World” based out of Rawalpindi, a city in northern Pakistan, according to a press release from the U.S. Department of Justice (DOJ).

The other three men charged include Muhammad Kamran Wali, 41, of Pakistan, Ashraf Khan Muhammad of Hong Kong and Ahmed Waheed, 52 of the United Kingdom.

None of the five men have been apprehended, but the release states arrest warrants are pending for all five defendants.

Each defendant is charged with two felony counts of conspiracy to violate the International Emergency Economic Powers Act and the Export Control Reform Act.

A grand jury indicted the men in October 2019 and was unsealed Wednesday.

“The defendants smuggled U.S.-origin goods to entities that have been designated for years as threats to U.S. national security for their ties to Pakistan’s weapons programs,” Assistant Attorney General for National Security John C. Demers said in the statement.

According to the indictment, between September 2014 and October 2019, the five men allegedly operated an international procurement network to acquire American goods for Pakistan’s Advanced Engineering Research Organization (AERO) and the Pakistan Atomic Energy Commission (PAEC).

Both AERO and PAEC are on the U.S. Commerce Department’s Entity List that “imposes export license requirements for organizations whose activities are found to be contrary to U.S. national security of foreign policy interests,” according to the release.

PAEC was added to the Entity List in 1998, and AERO in 2014 after the U.S. government determined it had used front companies and intermediaries to procure goods for Pakistan’s cruise missile and drone programs.

The indictment alleges the men attempted to conceal the true destinations of the goods they procured using their front companies, though the goods ultimately ended up in Pakistan and were paid for by either AERO or PAEC.

The indictment identified 38 separate exports the defendants sent from the U.S. using 29 different companies around the country – however, none of the companies are thought to be complicit in the illegal smuggling, according to the release.

“The alleged behaviour of these five individuals presented more than a violation of U.S. export laws, it posed a potential threat to the national security interests of the United States and to the delicate balance of power among nations within the region,” said Jason Molina, Acting Special Agent in Charge, Homeland Security Investigations.

None of the allegations have been tested in court.