The Department of State reports that it has concluded an administrative settlement with a U.S. company to resolve 750 violations of the Arms Export Control Act and the International Traffic in Arms Regulations.
Under the terms of a 36-month consent agreement the company agreed to pay a civil penalty of $200 million, but State will suspend $100 million of this amount provided that the company uses it for specified remedial compliance measures. In addition, for at least 24 months the company will be required to engage an external special compliance officer to oversee the consent agreement, which will require at least one external audit of the company’s ITAR compliance program and implementation of additional compliance measures.
According to a State press release, this settlement addresses the company’s unauthorized exports of defense articles resulting from the failure to establish proper jurisdiction and classification; unauthorized exports of defense articles, including classified defense articles; unauthorized exports of defense articles by employees via hand-carry to proscribed destinations; and violations of terms, conditions, and provisos of export authorizations from State’s Directorate of Defense Trade Controls. State notes that the company disclosed all of the alleged violations voluntarily, cooperated with the department’s review, and has implemented numerous improvements to its compliance program since the violative conduct.
For more information on U.S. export restrictions and how to ensure that your company is in compliance, please contact Kristine Pirnia at (202) 730-4964 or via email.
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