Exporters can anticipate “robust and comprehensive” enforcement efforts in the near future, according to remarks given by David Mills, Assistant Secretary for Export Enforcement. Mills was speaking at the annual update conference hosted by the U.S. Bureau of Industry and Security (BIS) in Washington, D.C.
According to Secretary Mills, for fiscal year 2013, BIS investigations led to 52 criminal convictions, with criminal penalties of more than $2.6 million, forfeitures of more than $18 million, and civil fines of $6.1 million. Last year also saw individuals penalized with more than 881 months of imprisonment for export violations.
Some of the highlights from Mills’ speech include:
- Weatherford International: This Houston-based company and its four subsidiaries agreed to pay $100 million for a variety of export violations to countries like Iran, Syria, Cuba, Venezuela and Mexico.
- Ming Suan Zhang: Late last year, Zhang was sentenced to 57 months in prison and a $1,000 forfeiture for attempting to export high-grade carbon fiber from the United States to China. This material is used in the production of items such as ballistic missiles, unmanned aerial vehicles, and nuclear centrifuges.
- New “600 Series” Items: In his remarks, Mills acknowledged that, to date, BIS has received only 18 Voluntary Self Disclosures (VSDs) for new “600 series” items. These represent items that were formerly controlled under the ITAR, which have now been moved to the jurisdiction of the EAR as part of the president’s Export Control Reform (ECR) initiative. Mills said that he expects most of these VSDs to result in a warning letter or no action at all.
- “Don’t Let This Happen To You”: In connection with Mills’ remarks at the conference, BIS has released an updated version of its popular document, which highlights some of the major enforcement cases in export control. You can access the new document here on the BIS website.
In conclusion, Mills stated that BIS will continue to focus its resources on those who commit the most egregious violations – purposefully skirting the rules for financial gain. He also stated that the best way for any company to ensure they are not committing export violations is to implement a comprehensive export compliance program. Words of wisdom for any business operating in today’s global marketplace.
Tom Reynolds is the Vice President of Operations for Export Solutions, a consultancy firm which specializes in ITAR and EAR compliance.