Transcript Presentation title slide - 42 pt Times New Roman, White

ICE
Jacqueline Cannon
Senior Special Agent
(619) 666-8943
[email protected]
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Counter-Proliferation
Investigations
Project Shield America
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Mission
ICE Counter-Proliferation Investigations
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Protect the American public from
the introduction of WMD and
other instruments of terror into
the United States
Prevent proliferating foreign
entities and terrorist
organizations from obtaining
strategic technology, licensable
dual-use commodities, weapons,
munitions, funds, and technical
support that could constitute an
immediate threat to national
security
Protect U.S. business interests
and revenue
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Partnership
ICE and Private Industry
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An industry outreach program designed to
obtain assistance and cooperation from
manufacturers, sellers, and exporters of U.S.
origin technology, dual-use, and munitions
Enhance public
awareness of export
laws
Provide an opportunity and forum for private
sector input and feedback
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Partnership
ICE and Private Industry
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We can assist you in detecting and avoiding
illegal transactions, which:
Cause negative publicity;
Result in fines, debarment, and/or
imprisonment;
Bring potential significant costs for legal
representation resulting from a criminal or
administrative proceeding
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Why the U.S. Controls Exports
Military / National Security Concerns
To restrict the export of goods, technology,
and services that could contribute to the
military capabilities of any other country or
combination of countries which could result in
an imminent threat to the national security of
the United States
March 2009
ICE
Office of
Investigations
Why the U.S. Controls Exports
Foreign Policy / Embargos
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Counter –
Proliferation
Investigations
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To restrict the export of goods and
technology where necessary to further the
foreign policy of the United States or to
fulfill its declared international obligations
Enhance regional stability
Terrorist concerns
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Why the U.S. Controls Exports
Protect U.S. Industry
To protect U.S. business interests by
preventing loss of U.S. origin technology to
countries and entities interested in reengineering commodities, which can result in
the significant loss of revenue to the U.S.
economy
70
60
50
40
Profits
30
20
10
0
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
March 2009
ICE
Office of
Investigations
U.S. Export Laws
Arms Export Control Act
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Counter –
Proliferation
Investigations
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Administered by the U.S. Department of State,
Directorate of Defense Trade Controls (DDTC)
http://www.pmddtc.state.gov
International Traffic in Arms Regulations –
Title 22 CFR 120-130
United States Munitions List (USML)
http://pmddtc.state.gov/consolidated_itar.htm
ITAR recordkeeping requirement – Five years
from date of export
March 2009
ICE
Office of
Investigations
U.S. Export Laws
Arms Export Control Act
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Counter –
Proliferation
Investigations
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Title 22 USC 2778
Requires registration of
persons and companies
engaged in the business of
manufacturing, brokering or
exporting defense articles
and services
Requires licenses to export firearms, munitions
and technology
Criminal violations
enforced by ICE
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
U.S. Export Laws
Arms Export Control Act / Brokering
No person may engage in the business of
brokering activities of United States Munitions List
commodities or technology without a license,
issued by DDTC
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A broker is any person who acts as an agent
for others in negotiating or arranging contracts,
purchases, sales, or transfers of defense
articles or defense services in return for a fee,
compensation, or other consideration
Brokering means acting as a broker and
includes financing, transportation, freight
forwarding, or taking any other action that
facilitates the manufacture, export, or import of
a defense service, irrespective of its origin
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
U.S. Export Laws
International Emergency
Economics Powers Act (IEEPA)
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50 USC 1701-1706
50 USC App. 2401, Et seq.
Administered by the Department of Treasury,
Office of Foreign Assets Control (OFAC)
Economic sanctions and embargoes against
countries and individuals (i.e. terrorists)
Current sanctions can be found:
http://www.treas.gov/offices/enforcement/ofac/
Enforced by ICE
March 2009
ICE
Office of
Investigations
U.S. Export Laws
Export Administration Act
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Counter –
Proliferation
Investigations
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Governs the export controls for
commercial and dual-use products
Export Administration Act (EAA) expired in
August 1994, however the Export Administration
Regulations (EAR) are enforced under IEEPA
by Presidential order
Complete EAR, CCL, and Commerce country
chart can be found:
www.access.gpo.gov/bis/index.html
Administered by the U.S. Department of
Commerce - Bureau of Industry Security
www.bis.doc.gov
Enforced by ICE and Commerce
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
U.S. Export Laws
Trading with the Enemy Act (TWEA)
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50 USC App. 1 - 44
Only applies to Cuba at this time
Administered by OFAC
No exports or imports authorized without
permission from OFAC (humanitarian reasons)
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
U.S. Export Laws
Smuggling Goods from the U.S.
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Title 18 USC 554 (Effective March 2006)
Any export or attempt to export
The transportation, concealment, transfer,
purchase of any merchandise knowing that it is
to be exported contrary to any law or regulation
March 2009
ICE
Office of
Investigations
Project Shield America
Deemed Exports / Intangible Transfers
Technology is "released" for export when it is
available to foreign nationals in the following forms:
Counter –
Proliferation
Investigations
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Visual inspection (such as reading technical
specifications, plans, blueprints, etc.)
Exchanged orally
Made available by practice or application under
the guidance of persons with knowledge of the
technology
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Project Shield America
Deemed Exports
Export license required under the "deemed export“
rule when both of the following conditions are met:
1.
Intent to transfer controlled information to
foreign nationals while in the United States;
and
2.
Transfer of the same technology to the
foreign national's home country would
require an export license
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Project Shield America
Potential Vulnerabilities
Releases of U.S. Technology:
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Inter-company transfers
Nonimmigrant employees
Nonimmigrant students/scholars
Foreign scientists
Joint ventures
Tours of labs
March 2009
ICE
Office of
Investigations
Project Shield America
Exporting Process
FIVE General phases to any export deal
Counter –
Proliferation
Investigations
1.
2.
3.
4.
5.
Inquiry
Negotiation
Contracting & sales
Shipping
Warranty & maintenance
March 2009
ICE
Office of
Investigations
Exporting Process
Inquiry Phase Red Flags
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Counter –
Proliferation
Investigations
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Multiple requests for identical product or
multiple buyers
Information requests for “educational research”
Uneducated or unfamiliar customer
“Mom & pop shop” commodity broker
Uninformed buyer
Outside normal sales channels
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Exporting Process
Negotiation Phase Red Flags
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Uninformed buyer
Unusual payment terms
 Cash
 Roundabout wire transfers
No price negotiation
Vague or non-existent end-user information
Refusal to provide end-use application
information
March 2009
ICE
Office of
Investigations
Exporting Process
Contracting & Sales Phase Red Flags
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Counter –
Proliferation
Investigations
Late change in deal terms and/or source of
payment
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Request drop shipment
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Refusal to provide end-user certificate
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Exporting Process
Shipping Phase Red Flags
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Hand-carry of data or equipment
Drop shipment to holding company or third
country freight forwarder
Inconsistencies across various documents
Suspect end-user: transshipment location
Inconsistent packaging or marking request
Incorrect license designation
Product does not match SED or license
Manuals & documentation in wrong language
Multiple shipments using single license number
March 2009
ICE
Office of
Investigations
Exporting Process
Warranty & Maintenance Phase Red Flags
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Counter –
Proliferation
Investigations
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Merchandise returns or repair requests from
wrong customer location
Request for replacement parts to wrong
customer location
Troubleshooting inquiries by e-mail from
different end-user or in the wrong language
Refusal to cooperate with post-shipment
verification
Discovery of item in unauthorized location
March 2009
ICE
Office of
Investigations
Exporting Violations
Consequences of Non-Compliance
It is UNLAWFUL to:
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Counter –
Proliferation
Investigations
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Export or attempt to export from the U.S., or to
re-export any defense article or technical data,
or to furnish any defense service without first
obtaining the required licenses from the DOS
Export or attempt to export from the U.S., or to
re-export any dual-use item without first
obtaining the required licenses from the DOC
March 2009
ICE
Office of
Investigations
Exporting Violations
Consequences of Non-Compliance
It is UNLAWFUL to:
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Counter –
Proliferation
Investigations
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Sell or transfer any export controlled commodity
to a person or business within the U.S., knowing
it will be illegally exported by that person or
business
Without a license, provide a foreign national
access to information or data within the U.S. if
the transfer of the same technology to the foreign
national’s home country would require an export
license
Violate any of the terms or conditions of licenses
or authorization granted by the DOS, DOC or
OFAC
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Exporting Violations
Consequences of Non-Compliance
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Seizure and/or forfeiture of goods
Imprisonment up to ten years for individuals
responsible for criminal violations
Loss of export and import privileges
Administrative penalties
Debarment from government contracting
Placement of company on “denied parties list”
Fines up to $1 million per violation or five times
the value of the product, whichever is greater
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Export Compliance
Your Role in Compliance
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Know your customer
Be alert
Recognize potential illegal
exports and diversion
See that transactions/orders
for production parts or technology are
handled by export specialists
Ensure that your export compliance specialists
are knowledgeable about current export
controls and licensing procedures
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Export Compliance
Due Diligence/Screening
Businesses should screen prospective customers,
vendors, suppliers, sub-contractors, sales
representatives, consultants, or any party to a
proposed export/import transaction against the
following lists:
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Specially Designated Nationals
www.treas.gov
Denied Persons List
www.bis.doc.gov/dpl
Debarred Parties List
www.pmdtc.org
March 2009
ICE
Office of
Investigations
Export Compliance
Due Diligence/Screening
Be prepared to answer these questions about
your products or services:
Counter –
Proliferation
Investigations
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What is the commodity?
Is the item listed on the USML or the CCL?
Does the item contain encryption?
Where is it going, what is the country of
ultimate destination?
Who will receive it, who is the ultimate enduser?
March 2009
ICE
Office of
Investigations
Export Compliance
Due Diligence/Screening
Be prepared to answer these questions about
your products or services:
Counter –
Proliferation
Investigations
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Does the end-use involve military applications?
What, if any, are the civil/commercial
applications for the product?
Is the item specifically configured, adapted,
modified, designed, and/or developed for
military application?
If in doubt, submit a “Commodity Jurisdiction
Request” to the Department of State at
www.pmdtc.org
March 2009
ICE
Export Compliance
Office of
Investigations
Known Proliferation Countries
Counter –
Proliferation
Investigations
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Iran
North Korea
China
Syria
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Proliferation Security Initiative
•Announced by President Bush in 2003, PSI was
formed to create a multi-national effort to interdict
illegal shipments of WMD, their delivery systems
and related materials
•ICE is the primary U.S. law enforcement agency
involved in the interdiction and investigation of “high
interest” illegal exports of U.S. origin technology
destined to countries of concern
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Export Compliance
Potential Transshipment Countries
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U.A.E
Cyprus
Jordan
Malta
Thailand
Yemen
Sudan
Singapore
Malaysia
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Project Shield America
Desired Chemical & Biological Technology
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Fermenters
Centrifugal separators
Safety hoods - Class II or III
Reactor vessels
Hastelloy-high nickel alloys
Double-seal pumps
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Project Shield America
Desired Nuclear Technology
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Maraging steel
Spin-forming machinery
Beryllium
Graphite components
Radiation shielding
Electron beam welders
March 2009
ICE
Office of
Investigations
Project Shield America
Desired Missile Technology
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Counter –
Proliferation
Investigations
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Guidance systems
 GPS/INS
 3-axis gyro
 3-axis accelerator
Motors
 Kevlar
 Maraging steel
 Carbon/carbon
 Carbon/phenolic
March 2009
ICE
Office of
Investigations
Project Shield America
Desired Missile Technology
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Counter –
Proliferation
Investigations
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Nose cone/re-entry vehicle
 Carbon/carbon
Skin
 Maraging steel
Solid fuel motor
 Propellants
Fins
 Carbon/carbon
March 2009
ICE
Office of
Investigations
Counter –
Proliferation
Investigations
Project Shield America
How to respond to a suspicious contact
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Don’t slam the door
Save all correspondence and make note of
phone calls
Obtain contact numbers and e-mail with full
headers
Keep it neutral
Quickly contact ICE Special
Agents for a controlled and
monitored response
March 2009
ICE
Office of
Investigations
Project Shield America
Contact Information
Immediately report all suspicious export
inquiries to ICE officials at:
Counter –
Proliferation
Investigations
1-866-DHS-2ICE
March 2009
ICE
Jacqueline Cannon
Senior Special Agent
(619) 666-8943
[email protected]