SynPep Corporation’s CEO Sentenced to Eight Months in Custody
SynPep Corporation Also Pleads Guilty to Making False Statements

OAKLAND—SynPep Corporation’s CEO, Dr. Chi Yang, was sentenced today to eight months in custody of the Bureau of Prisons, and ordered to pay a total of $100,000 in fines and restitution for making a false statement to the Lawrence Livermore National Laboratory (LLNL), United States Attorney Joseph P. Russoniello announced. In addition, SynPep Corporation today pled guilty to making false statements to LLNL, the National Institute of Health, and Walter Reed Army Hospital; it was sentenced to an additional $20,000 fine.

Dr. Yang pled guilty on November 10, 2009, to making a false statement by altering laboratory data sent to LLNL. According to the plea agreement, Dr. Yang admitted falsifying data relating to the purity of polypeptides, which are short, single linear chains of amino acids that serve as components of a protein. Dr. Yang admitted that he authorized the alteration of data relating to the purity of a peptide, so that LLNL did not receive complete and accurate test results. In the plea agreement, Dr. Yang admitted that the losses covered all altered test data that SynPep Corporation sent to its federal agency customers during the period 2001-2002.

“The Department of Defense’s Criminal Investigative Service (DCIS) is thoroughly committed to pursuing any and all allegations of criminal misconduct that drain precious resources from taxpayers. The falsified lab data in this case was directly related to medical research in support of America’s warfighters. The convictions of SynPep Corporation and Dr. Chi Yang were only made possible by the hard work of the prosecutors from the Department of Justice, agents from the DCIS, and our law enforcement partners,” said Rick Gwin, Special Agent in Charge, DCIS. As explained by Nick Torres, Special Agent in Charge of the Environmental Protection Agency’s Criminal Investigation Division: “Dr. Yang and SynPep Corporation submitted false laboratory data to federal agencies that rely heavily on the integrity of scientific reports. The EPA is committed to providing technical and investigative resources on complex cases that require collaboration among many different agencies to effectively investigate and prosecute cases of importance.”

Dr. Yang is out of custody, and has been ordered to self-surrender to the custody of the Bureau of Prisons on January 22, 2010. The sentences of Dr. Yang and SynPep Corporation were handed down by U.S. District Court Judge Saundra Brown Armstrong following guilty pleas to a total of four counts of making false statements in violation of 18 U.S.C. § 1001. Judge Armstrong also sentenced Dr. Yang to a three-year period of supervised release.

Assistant U.S. Attorneys Tina Hua and Tracie L. Brown are the Assistant U.S. Attorneys who prosecuted the case with the assistance of Elizabeth Garcia and Rayneisha Booth. The prosecution is the result of a lengthy investigation by the following law enforcement agencies: EPA-Criminal Investigation Division, Department of Health and Human Services-Office of the Inspector General, Federal Bureau of Investigation, Department of Defense-Criminal Investigative Service, and U.S. Department of Energy-Office of the Inspector General.

Further Information:

Case #: CR 06-0374 SBA

A copy of this press release may be found on the U.S. Attorney's Office's Web site at www.usdoj.gov/usao/can.

Electronic court filings and further procedural and docket information are available at https://ecf.cand.uscourts.gov/cgi-bin/login.pl.

Judges' calendars with schedules for upcoming court hearings can be viewed on the court's Web site at www.cand.uscourts.gov.

All press inquiries to the U.S. Attorney's Office should be directed to Jack Gillund at (415) 436-6599 or by email at Jack.Gillund@usdoj.gov.