Non-Compliance Penalties

Why You Must Comply with U.S. Export Regulations:  The price of non-compliance:

Violation of U.S. export regulationsViolation of U.S. export regulations can result in result in

  1. Significant financial penalties imposed by  U.S. export Enforcement agencies
  2. Restrictions placed on your company  that prevent it from exporting to new customer’s in the future (even if the transaction is legal).
  3. Imprisonment up to 10 years for Corporate Officers
  4. Significant diversion of in-house personnel to properly disclose and remedy any violations to the government’s satisfaction.

The Cost of Non-Compliance:

EAR ViolationsEAR Violations:

  • Criminal: $50K to $1 Million or 5 times the value of your export, whichever is greater, per violation, 10 years imprisonment.
  • Civil: revocation of exporting privilege.
  • Examples:
    -Bass Pro Shops- $510K for shipping guns without a license.
    -Dr. Thomas Butler, Texas tech – 2 years imprisonment for making  fraudulent claims and unauthorized exports (restricted bacteria).
    -ITT Corp.  fined $100 Million for exporting night vision materials without a license.

ITAR ViolationsITAR Violations:

  • Criminal: Up to $1 million per violation and 10 years imprisonment
  • Civil: seizure and forfeiture of article, revocation of exporting privilege, up to $500,000 fine per violation.
  • Examples:
    - Lockheed Martin fined $13 million
    -Raytheon fined $25 million
    -Hughes Electronics and Boeing Satellite Systems fined $32 million.
    University of Tennese Professor (Roth) convicted on 9/3/08 and recently sentenced to four years.

 

 

OFAC ViolationsOFAC Violations:

  • Criminal: $50K to $10 Million per violation and 10 to 30 years imprisonment.
  • Civil: $11 to $1Million per violation
  • Example:
    –September 2009:     Thermon Manufacturing, San Marcos, Texas, fined $14, 613 for three shipments to Sudan.  Fine significantly reduced because they disclosed  their violation to OFAC.

 

Are You in Violation?

The Bureau of Industry and Security and Office of Foreign Assets Controlstrongly encourage voluntary disclosure to the Office of Export Enforcement.  Voluntary self-disclosure is considered a mitigating factor in determining what administrative sanctions, if any, will be sought by the Office of Export Enforcement.
—Let Xport Advisors assist you in disclosing to the Government the right way and in a written format they prefer.

Contact us today to discuss your voluntary disclosure options 1.888.468.7910

 

Comments are closed.