Background

The Bureau of Industry and Security has announced the first settlement under new policies announced in July providing that in circumstances involving conduct that is relatively less serious from a national security perspective BIS will seek to resolve administrative enforcement actions with non-monetary penalties such as suspended denials of export privileges. To be eligible for such treatment respondents must accept responsibility, including by admitting to the underlying conduct, and agree to other remediation-oriented measures, such as participation in training programs and compliance audits.

On Aug. 1 BIS settled an administrative enforcement matter in which the owner of a company located in the U.S. and Mexico was charged with violating the Export Administration Regulations in connection with unlicensed exports of controlled items to Mexico. Specifically, the man ordered ballistic helmets and rifle scopes from a U.S. supplier and provided them to an individual in the U.S. for transport to Mexico, where he intended to receive the items for resale to Mexican government customers and retailers and distributors.

According to BIS, the owner admitted to this conduct and will be subject to a two-year suspended denial of his export privileges. He must also complete a 12-month internal audit of his company’s export controls compliance program and an export compliance training.

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