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Tung Tai, execs reach plea agreement

Keywords: Tags  Tung Tai Group, John Chen, Jason Huang, CalRecycle, electronic scrap recycling, Daniel Fitzgerald

NEW YORK — California scrap metals recycler Tung Tai Group Inc. and two of its managers have accepted a plea agreement on charges that they fraudulently sought reimbursement from the state’s Electronic Waste Recovery and Recycling Program.

The San Jose-based company, executive vice president John Chen and yard supervisor Jason Huang pleaded no contest in Santa Clara County Superior Court last month, according to the Department of Toxic Substances Control (DTSC), the Department of Resources Recycling and Recovery (CalRecycle) and the California Attorney General.

As part of the plea agreement, Tung Tai, Chen and Huang must withdraw as certified recyclers and approved collectors in the program, and must stop shredding, dismantling or processing electronic scrap. The defendants must also pay $75,000 in penalties to the court and $50,000 to the California Attorney General’s Office, which prosecuted the case.

"While there have been several administrative actions taken for noncompliance with the recycling payment system and hazardous waste rules, this is the first criminal prosecution in California," the agencies said.

However, Chen told AMM that he still believes the company would have been exonerated if the case had gone to trial.

"As in many plea bargains, we weighed the high costs of trial and the uncertainty and time spent for a trial, and came up with what we feel is a settlement (in) which we can continue business as usual," he said.

Chen claimed that his company was actually the victim of an "unscrupulous supplier," and that their legal defense would have contained evidence proving this.

"We intend to take legal action against these persons and would be interested in working with the DTSC and the Attorney General to provide evidence we have gathered and clear our name," he said.

The defendants were accused of attempting to collect more than $1 million from the program for electronic waste that the company never collected or recycled. The alleged fraud was uncovered by the DTSC’s Office of Criminal Investigations following a tip from CalRecycle staff, which review electronic waste payment claims for discrepancies (, Aug. 30, 2010).

CalRecycle pays a rebate of 39 cents per pound to recyclers for material recycled from electronics.

"This case demonstrates that those who make false claims for payment from CalRecycle will not only have their claims denied, but face the prospect of severe consequences resulting from criminal prosecution," CalRecycle director Caroll Mortensen said.

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