Bag and Baggage
Posted by Clif Burns at 9:12 pm on April 23, 2008
Category: BIS • SEDs
A recent settlement agreement between the Bureau of Industry and Security (“BIS”) with Miami-based Aviktor Trading Corporation involved both a charge of an unlicensed export of a thermal imaging camera and a charge of failure to file a Shipper’s Export Declaration. The latter charge is fairly rare. After all, how exactly do you manage to export something without filing an SED?
Although the charging documents don’t make this clear, it seems likely that Aviktor exported the thermal imaging camera in checked or carry-on baggage of an airline passenger. Normally an SED is not required for baggage but there is, of course, a significant exception. Section 758.1(b)(2) requires that an SED be filed for any export that requires a license, regardless of value or destination.
Obviously, the SED charge was just another case of piling on by BIS but this is a good opportunity to remind exporters that if you hand carry an licensed item to its destination, don’t forget to file the SED with Customs before departing.
Is the DOJ Tilting at Windmills?
Posted by Clif Burns at 9:09 pm on September 20, 2007
Category: OFAC • SEDs
This morning we laid our hands on the criminal complaint, unsealed earlier this week, charging a Dutch aviation parts firm and its owner Rob Kraaipoel with export violations. The underlying violations charged by the criminal complaint are fairly simple. The complaint alleges that Aviation Services International B.V. and it’s owner Rob Kraaipoel purchased various aviation items from U.S. companies and then sold them to customers in Iran without the necessary OFAC license. Additionally the complaint alleges that Aviation Services caused other to make fraudulent statements on Shippers’ Export Declarations (SEDs) as to the end users of items purchased by the company from vendors in the United States.
The story told by the criminal complaint starts with purchases in 2005 and 2006 of audio and video equipment by Aviation Services from New Hampshire-based DTC, Inc. When DTC requested that Aviation Services identify the end user for the equipment, Kraaipoel is alleged to have sent an email to DTC indicating that the Polish Border Control was the end user. This information was then used by DTC’s freight forwarder when it filled out the Shipper’s Export Declarations for these exports. According to the complaint, the Polish Border Control denies having purchased anything from Aviation Services. Subsequently when Aviation Services requested spare parts for these items, it sent an email to DTC that the end user was a company in Cyprus.
Based on these facts, the complaint charges Kraaipoel with two counts of false statements in violation of 18 U.S.C. § 1001(a). These charges are asserted even though Kraaipoel made no representations to any U.S. government official and even though there is no allegation that Kraaipoel knew that his representations as to the end-user would even be provided to the U.S. government. Nor is there any allegation that these items were ultimately exported to Iran or other embargoed country. Indeed, it appears that they ended up in Cyprus instead.
Felony charges under 18 U.S.C. § 1001(a) seem questionable under the facts alleged. A Dutch citizen sends an email to a private individual in the United States and then faces criminal charges in the United States because inaccurate information in that email is provided, without the Dutch citizen’s knowledge, to the U.S. government. Consider also that a reseller of aircraft parts has a legitimate commercial interest in not providing the end-user’s name to his vendor in order to prevent the vendor from cutting him out as the middleman in future transactions. Because of that Aviation Services misidentification of the end user isn’t necessarily suspicious. And since there is no evidence that the equipment wound up in an embargoed country, it’s even more difficult to assert that there was any criminal intent on the part of the Dutch company.
There’s much more to discuss about the complaint. Tomorrow we will look at the remaining counts of the complaint relating to items that were purchased from other vendors and that were allegedly transshipped by Aviation Services to Iran.