PHILADELPHIA – United States Attorney William M. McSwain and Assistant Attorney General for National Security John C. Demers announced that the following defendants were indicted on charges of conspiracy, violating the International Emergency Economic Powers Act (“IEEPA”), and conspiracy to commit money laundering based on their attempt to transact in sanctioned Iranian petroleum:

Nicholas Hovan, age 34, of New York, NY;

Zhenyu Wang, a/k/a “Bill Wang,” age 39, of Dallas, TX;

Robert Thwaites, age 30, of Dallas, TX; and

Daniel Ray Lane, age 39, of McKinney, TX.

The Indictment alleges that from May 2019 to February 2020, the defendants conspired in Philadelphia and elsewhere to arrange for the purchase of petroleum from the Islamic Republic of Iran, in violation of United States economic sanctions imposed on Iran, for sale to a refinery in the People’s Republic of China. They also allegedly conspired to launder the proceeds of the sale through shell entities and offshore financial accounts to disguise the nature of the transaction. More specifically, the defendants are charged with conspiring to purchase sanctioned Iranian petroleum, to sell the petroleum to a Chinese refinery, to conceal the origin of the petroleum (including by bribing a Chinese official), and to obtain Antigua passports to open Swiss bank accounts through which the proceeds would be laundered.

In February 2020, the defendants were arrested pursuant to a criminal complaint. As previously reported, the defendants planned two shipments of oil per month going forward, all for an expected profit of roughly $28 million-per-month.

“It doesn’t get much lower than attempting to get rich by flouting the United States’ national security interests,” said U.S. Attorney McSwain. “The defendants here allegedly jeopardized the safety and security of the United States by scheming to get in bed with Iran and China. This type of conspiracy deserves the full condemnation of my Office -- and it has it.”

“The defendants in this case allegedly conspired to sell Iranian petroleum to a Chinese refinery in order to enrich themselves at the expense of the US Iran sanctions regime,” said Assistant Attorney General for National Security John C. Demers.  “The defendants devised a scheme to use front companies, bribes, and false contractual documents in order to conceal their brazenly illicit activity.  We will continue to leverage all of our tools to detect and prevent individuals such as these from engaging in actions that would have harmed the national security of this nation.”

If convicted, each defendant faces a maximum possible sentence of 45 years in prison, a $1.75 million fine, a three year term of supervised release, and a $300 special assessment.

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by First Assistant U.S. Attorney Jennifer Arbittier Williams and Assistant U.S. Attorney Michael J. Rinaldi, in partnership with Trial Attorney David Recker of the Department of Justice’s National Security Division, Counterintelligence and Export Control Section.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William M. McSwain and Assistant Attorney General for National Security John C. Demers announced that the following defendants were arrested and charged by Complaint on charges of conspiracy and violating the International Emergency Economic Powers Act (“IEEPA”) based on their attempt to transact in sanctioned Iranian oil:

Nicholas Hovan, age 33, of New York, NY;

Zhenyu Wang, a/k/a “Bill Wang,” age 39, of Dallas, TX;

Robert Thwaites, age 30, of Dallas, TX;

Nicholas James Fuchs, age 26, of Dallas, TX; and

Daniel Ray Lane, age 38, of McKinney, TX.

The defendants are each charged with one count of conspiracy and one count of violating IEEPA, based on allegations that from July 2019 to February 2020 they conspired in Philadelphia and elsewhere to arrange for the purchase of oil from the Islamic Republic of Iran, in violation of United States economic sanctions imposed on Iran, for sale to a refinery in China. 

The Complaint alleges that defendants Nicholas Hovan, James Fuchs, Robert Thwaites, and Daniel Ray Lane arranged to purchase the illegal oil and sell it to a refinery in China represented by defendant Zhenyu Wang, a/k/a “Bill Wang.”

According to the Complaint, defendant Lane offered to further the conspiracy by laundering money through his company, STACK Royalties.  The charges further allege that the defendants agreed to use a Polish shell corporation as a straw seller of the illicit oil, and that they planned two shipments of oil per month going forward, all for an expected profit of roughly $28 million-per-month.  In addition, the charges allege that defendants Fuchs and Wang agreed to apply for foreign passports in order to set up offshore accounts that would not be reported to U.S. authorities.  

“The defendants in this case allegedly committed serious federal crimes that are in direct contradiction to the United States’ national security interests,” said U.S. Attorney McSwain.  “By devising a scheme to purchase oil from Iran, conceal its origins via a refinery in China and make tremendous profits, the defendants were attempting to enrich both themselves and the nation of Iran -- thus jeopardizing the safety and security of the United States and our allies.  This type of subversion of U.S. policy and law will not be tolerated: these defendants will be prosecuted to the fullest extent of the law.”

“With the goal of illegally enriching themselves, the defendants conspired for over eight months to devise a scheme to violate U.S. sanctions imposed on Iran, particularly the ban on foreign oil sales,” said Assistant Attorney General for National Security John C. Demers.  “The sale of oil is the lifeblood of the Iranian economy.  At the same time the United States was increasing its sanctions in order to pressure Iran to stop its malign activities, these defendants put greed ahead of country.  I commend the efforts of the agents and prosecutors who investigated and uncovered this brazen evasion of U.S. law.”

“These defendants allegedly conspired to circumvent economic sanctions enacted to protect the United States’ national security,” said Tara A. McMahon, Acting Special Agent in Charge of the FBI’s Philadelphia Division. “In their minds, sanctions weren’t so much an impediment as an opportunity. They thought they could make their millions and escape the United States Government’s notice. Well, as these charges show, they were wrong. The FBI takes sanctions violations extremely seriously and will bring all our investigative resources to bear, to end such harmful and illegal activity.”

If convicted, the defendants each face a maximum possible sentence of 25 years’ incarceration, as well as a maximum possible fine of $1.25 million.  Four of the arrests occurred in Philadelphia and one occurred in Texas.  The four defendants arrested in Philadelphia had initial appearances in federal court today.

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Michael Rinaldi and First Assistant United States Attorney Jennifer Arbittier Williams, in partnership with Trial Attorney David Recker of the Department of Justice’s National Security Division, Counterespionage Section.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.