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$13 Million Penalty for Export Violations

Wednesday, September 25, 2019
Sandler, Travis & Rosenberg Trade Report

The Department of State reports that a U.S. company will pay a $13 million civil penalty as part of a consent agreement resolving alleged violations of the Arms Export Control Act and the International Traffic in Arms Regulations. Among other things the company was charged with unauthorized exports of defense articles, including technical data involving radios, and failing to properly manage temporary export licenses.

The department has agreed to suspend $6.5 million of the penalty on the condition that the funds have been or will be used for approved remedial compliance measures. In addition, the company will engage an external special compliance officer to oversee the consent agreement, which will require the company to conduct two external audits of its compliance program and implement additional compliance measures.

State notes that it has declined to administratively debar the company given that it voluntarily disclosed the majority of the alleged violations, acknowledged their serious nature, cooperated with the department’s review, and instituted a number of compliance program improvements during the course of the review. 

For more information on export laws and regulations, please contact export compliance attorney Kristine Pirnia.

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