Telecom firm received stimulus funds, sold U.S. surveillance equipment to Iran

ZTE USA, a U.S. subsidiary of the Chinese telecom firm, ZTE, has allegedly sold banned U.S. surveillance equipment to Iran, essentially bypassing current U.S. trade restrictions and embargoes imposed on Iran.

ZTE USA reaped substantial profits from the stimulus funds.

In January of 2010, US regional operator, Commnet Wireless contracted with ZTE USA to build broadband infrastructure network covering parts of Arizona, New Mexico and Utah. And, at the time, ZTE USA and the Navajo Tribal Utility Authority were reportedly in discussions for additional US Broadband Stimulus funding from the National Telecommunications and Information Administration.

And, indeed, the National Telecommunications & Information Agency [NTIA] announced in March of 2010 that the Navajo Tribal Utility Authority received a $32.2 million broadband infrastructure grant as part of the American Recovery and Reinvestment Act to bring high-speed affordable broadband services to the Navajo Nation.

Likewise, Fierce Broadband Wireless News reported in April of 2011 that "the Navajo Tribal Utility Authority and Commnet Wireless formalized a partnership this week after the two entities secured $32.1 million in broadband stimulus funds in March."

Hence, it appears as if ZTE USA, the company that allegedly sold banned U.S. surveillance equipment to Iran, profited substantially from the U.S. tax payer funded stimulus program.

Incidentally, the Wall Street Journal reported in October of 2010 that "four lawmakers [had] sent a letter Oct. 19 urging the Federal Communications Commission to take a closer look at ZTE..., and to consider restrictions that would make it harder for them to do business in the U.S."

The letter says Chinese telecom-gear makers are potentially subject to "significant influence by the Chinese military which may create an opportunity for manipulation of switches, routers, or software embedded in American telecommunications network so that communications can be disrupted, intercepted, tampered with, or purposely misrouted."

ZTE said the letter is a mischaracterization of the company, [as] it has no current ties to the Chinese government or military.

Apparently, the Obama administration ignored the letter, as evidenced by the fact that ZTE USA secured the $32.1 million in broadband stimulus funds the following year, in March of 2011.

And now, the company which previously disavowed any ties to the Chinese government, has allegedly sold banned U.S. surveillance equipment to Iran.