Author Archive


Mar

7

DDTC Poised to Impose Export Ban on BAE


Posted by at 6:46 pm on March 7, 2011
Category: Arms ExportDDTC

BAEAlmost one year ago, on March 4, 2010, this blog reported that the Directorate of Defense Trade Controls (“DDTC”) had posted a website notice that all BAE export licenses were on temporary hold. This came several days after BAE had pleaded guilty to charges that it had paid bribes in violation of the Foreign Corrupt Practices Act and failed to report them as commissions in violation of the Arms Export Control Act. DDTC said the hold was to allow the agency to consider the impact of BAE’s guilty plea. And then, almost as quickly as the notice appeared — poof! — it was gone.

Well, the DDTC has apparently meditated on the fate of BAE long enough. An article in today’s Financial Times reported that BAE is bracing itself to have DDTC impose additional fines on the company and to suspend BAE’s privilege to export defense articles. Given BAE’s participation in such multilateral defense projects as the Joint Strike Fighter, it seems unlikely that the DDTC will impose a total export ban on BAE, but some version of an export ban is, apparently, both likely and imminent.

According to the Financial Times, the State Department was keeping mum on the matter but a BAE spokesperson had this to say: “Dialogue continues and is progressing with the Department of State in order to address its concerns regarding matters arising from the [Department of Justice] settlement.”

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Mar

3

Have Guns, Will Travel


Posted by at 9:29 pm on March 3, 2011
Category: Arms ExportCriminal Penalties

Steven GreenooeUK citizen and former U.S. Marine Steven Greenoe (pictured right) pleaded guilty yesterday to one count of violating the Arms Export Control Act and one count of filing a false ATF form in connection with his unlicensed exports of more than 60 guns from the United States to the United Kingdom. Greenoe packed the weapons in suitcases that he took with him on ten flights from the United States.

The most interesting aspect of the case is how easily Greenoe was able to ship these guns in his luggage. The guns were disassembled and scattered throughout his suitcases. During a trip last May to Atlanta, where Greenoe was catching a connecting flight to Manchester, scanners detected the gun parts when Greenoe checked his luggage in Raleigh-Durham. Somehow or other he convinced TSA agents that he was a firearms salesman and that the parts were non-working “engineering samples.” He was then allowed to board his flight to Atlanta and then to continue on to Manchester with the guns in his luggage.

An investigation into a cache of guns recovered by British police ultimately led British authorities to Greenoe. Greenoe was arrested at the Raleigh airport in July after a tip-off from British police. Greenoe apparently told U.S. investigators that he was a security consultant and that these guns were for his employees working in pirate-infested waters off the coast of Somalia. Even were this colorful explanation true, it would not justify failing to obtain an export license for the guns.

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Feb

28

Libya: The Hammer Begins to Fall


Posted by at 7:11 pm on February 28, 2011
Category: Libya Sanctions

Col. GadaffiNow that most U.S. citizens appear to have been evacuated from Libya, the White House has begun to re-impose sanctions on Libya, although they are far from comprehensive. On Friday, February 25, President Obama release an Executive Order that blocked the assets of the government of Libya, Colonel Gadaffi and his family and prohibited the provision or receipt of goods, funds or services to and from these entities and individuals. The Executive Order also invoked section 203(b)(2) of the International Emergency Economic Powers Act, 50 U.S.C. 1702(b)(2), to prohibit humanitarian donations of food, clothing or medicine to Gaddafi and his family, although such donations seem unlikely in any event. It is doubtful that any clothing that could be donated to the Colonel would even meet his bizarre sartorial standards.

In addition to the Colonel himself, the Executive Order designated Ayesha, his only daughter; Saif al-Islam, his second oldest son; Mutassim, his fourth eldest son; and Khami, his seventh son. Sons Muhammed, al-Saadi, Hannibal and Saif al-Arab have, at least for the moment, escaped the OFAC ban hammer. Khamis was no doubt singled out for his recruitment of the mercenary force used against protesters in Libya.

The designation order reflects considerable uncertainty about the correct transliteration of the Colonel’s family name. Ayesha and Mutassim have the surname Gaddafi listed first, whereas the Colonel, Saif al-Islam and Khamis have their surname spelled Qadhafi. In all fairness, ABC says that there are 112 known spellings of the Colonel’s name and there was even a 1981 Saturday Night Live skit based entirely on confusion about how to spell his name. And Gaddafi’s own website, algathafi.org, spells the name in a way found almost nowhere else.

In addition to the sanctions imposed on the Colonel and some of his children, the Directorate of Defense Trade Controls (“DDTC”) announced today that all export licenses it had issued for exports to Libya had been suspended until further notice and that no exemption set forth in the International Traffic in Arms Regulations could be utilized for exports of defense articles and services to Libya. Currently only non-lethal defense articles and services and safety-of-use items, such as technical manuals and ejection seats for military aircraft, that are parts for lethal defense articles could be authorized for export to Libya.

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Feb

24

Libya Sanctions: Easier Said Than Done


Posted by at 9:39 pm on February 24, 2011
Category: Libya Sanctions

Col. GaddafiA thoughtful article from the McClatchey News Service explains why no matter how attractive it may seem now to impose economic sanctions on Libya, that is something easier said than done. Administration aides in Washington told McClatchey that even though Obama has so far not called directly for sanctions against Libya, the White House would seek such sanctions in cooperation with international partners.

The first complication, of course, is that the United States does not want to jeopardize the safety of the many Americans that remain trapped in Libya. Although many U.S. citizens have been able to leave on a State Department chartered ferry from Tripoli to Malta, many more U.S. citizens who are working on oil fields are stranded in remote locations. A second problem with sanctions is that, to the extent they try to cut off sales of Libyan oil, they will have a detrimental impact on U.S. consumers by increasing the price of oil. Third, unilateral U.S. sanctions would have little impact on Libya because there is very little trade between the U.S. and Libya. Those are all fair points.

Libya is already subject to an arms embargo under section 126.1 of the International Traffic in Arms Regulations. Exceptions to the embargo are made for non-lethal defense articles and safety-of-use items, such as technical manuals and ejection seats for military aircraft, as parts for lethal defense articles. The use of military aircraft against the civilian population of Libya could serve as a justification for the elimination of these exceptions, but there is no indication that this is currently being contemplated.

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Feb

23

Don’t Believe Everything You Read in the Newspaper


Posted by at 9:20 pm on February 23, 2011
Category: ITAR

Frank GaffneyI’m just going to let this quote from Frank Gaffney in an opinion column in the Washington Times speak for itself:

“Given the well-known corruption practices by EADS, it would make common sense that it not be awarded Pentagon contracts. In fact, Congress has passed the Foreign Corrupt Practices Act that bars companies who engage in bribery overseas from competing for United States government programs.

“The U.S. Department of Justice has appallingly interpreted the laws to cover only U.S.-based companies – therefore exempting EADS. But it gets worse. The federal government has gone even further and exempted EADS from the Buy American Act, the Berry Amendment, the International Trafficking and Arms Regulations and the Cost Accounting Standards. Complying with these expensive regulations is mandatory for any American company looking to do business with the Pentagon, but waived for a foreign competitor such as EADS.”

Gaffney is quoting approvingly Representative Todd Tiahrt, a U.S. Congressman from Kansas. I’m sure that the Department of Justice as well as DDTC will be just as surprised as you and I are that DOJ had exempted EADS from all defense-related export controls. If I figure out how to get an exemption from the ITAR from Justice, you’ll be the first to hear about it here.

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Copyright © 2011 Clif Burns. All Rights Reserved.
(No republication, syndication or use permitted without my consent.)