Former CBP Officer Sentenced for Running Illegal Gun Business

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By on January 28, 2020 in Court Cases with 0 Comments
Wooden judge's gavel with a pair of handcuffs and stack of $100 bills on a wooden surface

A former Customs and Border Protection officer was sentenced to 31 months in federal prison for operating an illegal gun-selling business, possessing machine guns and other prohibited firearms, failing to disclose his foreign financial interests and contacts in China in order to obtain a secret-level security clearance, and cheating on his federal income taxes.

Wei Xu, 58, of Santa Fe Springs, CA had previously pleaded guilty in July to four felonies.

Xu was also ordered to pay $128,407 in restitution to the Internal Revenue Service.

When he pleaded guilty, Xu admitted that he sold at least 99 firearms without the required federal license in the 20 years prior to his arrest nearly one year ago.

To increase the profits of his unlawful firearms business, Xu exploited his status as a law enforcement officer to purchase, and then transfer, “off-roster” handguns that cannot be sold to the general public by a federal firearms license dealer.

According to court documents, in July and August 2018, Xu sold four firearms to an undercover agent posing as a buyer, and Xu unlawfully sold three of the firearms out of the trunk of his car. The firearms included an “off-roster” pistol, high-capacity magazines, and a short-barreled rifle – which Xu provided information on how to convert to a fully automatic firearm.

During one such sale, the affidavit stated that Xu showed up in a Maserati, and when the undercover agent commented on the car, Xu said, “I’m like you, playboy.”

A search of Xu’s residence on February 5, 2019 led to the recovery of more than 250 firearms, including 41 machine guns and two additional short-barreled rifles – all of which never were registered with the Bureau of Alcohol, Tobacco, Firearms and Explosives as required by federal law.

Xu also admitted that he made materially false statements on three questionnaires submitted to the Office of Personnel Management (OPM) to obtain a secret-level security clearance.

Specifically, Xu maintained foreign financial interests and had nearly weekly contacts with business associates in China as part of his employment as an accounts manager for a China-based auto parts import company. Xu collected a commission for his work and remitted the profit to his China-based business partners. But on his security clearance questionnaires in 2003, 2011 and 2015, Xu denied maintaining close and continuing contacts with foreign nationals, denied having a foreign financial interest, and denied having a business venture with a foreign national.

Finally, Xu admitted in his plea agreement that he willfully evaded the payment of federal income taxes for the years 2005 through 2017.

He established a sham company that claimed fictional losses, which he used to offset his CBP income and fraudulently evade federal income taxes. In a sentencing memorandum filed with the court, prosecutors argued that Xu also failed to report income from a rental property and the profits of his unlicensed gun business.

“Mr. Xu betrayed his oath to uphold the laws of the United States solely to put more money in his pocket,” said United States Attorney Nick Hanna. “The scope of his corrupt conduct is wide-ranging – he endangered the public by selling off-roster firearms, and he lied to federal government officials to cover up his illegal activities and his connections to Chinese nationals. The prison sentence imposed today is the result of Mr. Xu’s conscious choices to take advance of his law enforcement position to generate profits for himself.”

© 2020 Ian Smith. All rights reserved. This article may not be reproduced without express written consent from Ian Smith.

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Ian Smith is one of the co-founders of FedSmith.com. He enjoys writing about current topics that affect the federal workforce.

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