Zhenyu “Bill” Wang and Daniel Ray Lane, two Texas men, have been sentenced to 45 months in prison. They were sentenced for attempting to violate the International Emergency Economic Powers Act (IEEPA), conspiring to violate IEEPA, and conspiring to commit money laundering. Their convictions are the result of efforts to transact in sanctioned petroleum from Iran and launder the proceeds. The FBI investigated the case, which was prosecuted by Pennsylvania’s U.S. Attorney Office for the Eastern District. This case highlights the U.S. government’s strong commitment to enforcing economic sanctions and protecting national security against illicit activities.
The Scheme Orchestrated by Wang and Lane
Wang and Lane engaged in a complex scheme from July 2019 to February 2020 to evade U.S. sanctions against Iran. Their goal was to facilitate the purchase of Iranian oil, conceal its origins, and sell it to buyers in China. This involved several illegal activities:
Concealing the Oil’s Origin: The conspirators communicated extensively among themselves and with third parties to disguise the Iranian origin of the oil. They prepared false contracts and shipping documents to present the oil as coming from different sources.
Logistical Arrangements: Wang and Lane arranged for the oil to be shipped and took steps to ensure it could pass through international waters without raising suspicion.
Financial Maneuvering: They planned to receive the proceeds from the sale through offshore bank accounts and used various methods to launder the money. This included obtaining Antiguan passports to facilitate transactions and purchasing a cash machine to count large sums of money quickly.
Distribution of Proceeds: The conspirators discussed how to distribute the profits from the sale while concealing their origin and ownership.
The Key Roles of Wang and Lane
Wang played a critical role by connecting with Chinese buyers and securing written offers from them. He also brokered a contract for the sale and arranged bribes for Chinese officials to smooth the transaction. Lane agreed to help launder the proceeds. Through his business, Stack Royalties, he offered to use the sale of mineral rights to hide the Iranian profits.
Potential Profits Anticipated by Wang and Lane
The conspirators expected to make significant profits from their illegal activities. Wang and Lane initially planned to ship 500,000 barrels of oil but intended to scale up to one or two million barrels per month. Lane and another co-conspirator anticipated an initial $5 million payment to fund the scheme, with $4 million provided in cash. Wang projected a profit of $1.5 million for each 500,000-barrel shipment.
Awareness of Illegality by Wang and Lane
Despite their efforts to hide their activities, both Wang and Lane were fully aware that they were violating U.S. sanctions. Wang candidly discussed the profits from illegal transactions, stating, “I love sanctions, to be honest with you, and the sanctions make everybody money.” Lane similarly talked about ways to circumvent the sanctions, saying that sanctions can always be manipulated and there is always a way to circumvent them.
Sentencing and Prosecution of Wang and Lane
In addition to Wang and Lane, several co-conspirators were also sentenced for their roles in the scheme. In January 2024, Nicholas Hovan was sentenced for 12 months and one day in prison, while Nicholas Fuchs and Robert Thwaites were sentenced for 10 months each. These sentences reflect the broader scope of the conspiracy and the multiple parties involved in attempting to evade U.S. sanctions.
Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division emphasized the gravity of the crime, stating that, today, Lane and Wang are held accountable for attempting to broker illicit oil sales between Iran and China and also launder the proceeds, in violation of U.S. sanctions. The court’s sentence also clearly states that those who place personal profit over national security will face serious consequences.
U.S. Attorney Jacqueline C. Romero for the Eastern District of Pennsylvania said that it’s one thing to be entrepreneurial and take risks. But when your business plan is found to evade U.S. sanctions, then you’re doing it wrong. She highlighted the importance of enforcing sanctions laws to protect American interests and national security, highlighting the government’s commitment to holding violators accountable.
This case serves as a reminder of the U.S. government’s unwavering stance on sanction violations. The sentencing of Wang and Lane highlights the serious consequences faced by those who attempt to undermine U.S. sanctions for personal gain. The FBI’s commitment to using all lawful authorities to stop such illegal activities reaffirms the importance of these laws in safeguarding national security.
