Archive for the ‘Indonesia’ Category

Singaporean Extradited for Illegal Exports Later Found in IEDs

2016/05/05

By: Danielle McClellan

Lim Yong Nam (known as Steven Lim), a citizen of Singapore, has been extradited from Indonesia to stand trial in Washington, DC on charges of conspiracy.  He allegedly caused 6,000 radio frequency modules to be illegally exported from the US to Iran. Over the course of May 2008 and July 2010, sixteen of the modules were found in unexploded IEDs recovered in Iraq by coalition forces.

Between 2007 and February 2008 Lim and others in Singapore purchased 5 shipments of radio frequency modules from a Minnesota-based company by falsifying documents that stated the modules would stay in Singapore. When the modules were purchased they were always destined for Iran, however, Lim and his Singapore counterparts knew this would not be approved by the US government so they concealed the ultimate origin from the US manufacturer.

In 2009, when Lim was questioned by US authorities he was adamant that he never participated in any illicit exports to Iran. Communications were later found between Lim and several others regarding the US export rules and the issues with sending the modules to Iran.

Lim is currently facing the following charges:

  • One count of conspiracy to defraud the US
  • One count of smuggling
  • One count of Illegal export of goods from the US to Iran
  • One count of making false statements to the US Government
  • One count of making false statements to law enforcement

More details: https://www.justice.gov/opa/pr/singapore-man-extradited-united-states-connection-plot-involving-exports-iran-us-components


Alstom S.A. Pays $772 Million Fine for Violating FCPA…5 Executives Being Charged Too

2015/12/04

By: Danielle McClellan

Alstom S.A., a French power and transportation company, was sentenced today to pay a $772,290,000 fine to resolve criminal charges related to a corruption scheme that involved over $75 million in hidden bribes paid to governments worldwide. The company’s subsidiaries were also charged as follows:

  • Alstom Netwrok Schweiz AG formerly known as Alstom Prom AG (Alstom Prom), the company’s Swiss subsidiary pled guilty to conspiring to violate the anti-bribery provisions of the FCPA.
  • Alstom Power Inc. and Alstom Grid Inc., formerly T&D Inc., the two US subsidiaries have entered into deferred prosecution agreements after admitting they both conspired to violate the anti-bribery provisions of the FCPA.

All of the Alstom companies, through various executives and employees paid bribes to government officials in Indonesia, Egypt, Saudi Arabia, the Bahamas and Taiwan. The companies worked together to falsify books and records in connection with power, grid and transportation projects for state-owned entities around the world. Alstom paid more than $75 million to secure more than $4 billion in projects around the world, with a company profit of around $300 million.

Alstom attempted to conceal the bribery scheme by retaining consultants who provided consulting services on behalf of the companies, but who actually served as conduits for corrupt payments to the government officials. This sentence is the largest criminal fine ever imposed in FCPA history and reflects the following:

  • Failure to voluntarily disclose the misconduct
  • Previous corruption problems
  • Refusal to fully cooperate with the department’s investigation for several years
  • Breadth of misconduct
  • Lack of an effective compliance and ethics program at the time of the conduct

To date, five Alstom corporate executives have been charged for alleged corrupt conduct.

More details: http://www.justice.gov/opa/pr/alstom-sentenced-pay-772-million-criminal-fine-resolve-foreign-bribery-charges


DOD Announced New FedEx Shipping Policy

2009/08/04

By: Danielle McClellan

DOD has released an update involving FedEx shipping activities for items shipped from Pacific locations to Europe, CENTCOM AOR and intra Pacific. On August 4, 2009 DOD released a statement advising that in addition to an earlier restriction to ship to Indonesia, Malaysia, Philippines, Thailand and Vietnam, FedEx can now no longer accept shipments containing ITAR controlled items for movement between the following regions:

  • APAC-Middle East
  • Middle East-APAC
  • APAC-Europe
  • Europe-APAC
  • Intra APAC
  • APAC-India
  • India-APAC

The only routing for ITAR controlled shipments is via the FedEx hub in China.

Don’t forget to always check the ITAR prior to booking a shipment to any of the above mentioned countries with FedEx.

More information: Surface Deployment and Distribution Command – August 4, 2009 Advisory


ITAR Conviction Overturned Because the ITAR Is Vague

2009/06/15

By: Danielle McClellan

If you haven’t read our August 2009 article about Del Monte suing OFAC for “unreasonably delaying” their license approval, you really should after this article. It seems as though the courts are beginning to favor exporters over the complicated and time ensuing government regulators. Although the Del Monte case is in its very early stages and may not even amount to a victory for the aggravated exporter, this case however, has been finalized and the exporter won… well maybe not won, but won’t be going to jail or paying any huge penalty fines for violating the ITAR.

Doli Syarief Pulungan was convicted of trying to smuggle assault rifle scopes from the US to Indonesia. Pulungan apparently tried to get an “unnamed” friend and “unnamed” police chief in Wisconsin to buy 100 scopes for him; these scopes are designed to be used on M-16 and AR-15 assault rifles for close-quarters combat. There is no doubt that Pulungan was guilty of smuggling these scopes, in May 2008 he was convicted of violating the ITAR, specifically exporting/attempting defense articles without a license. Pulungan immediately appealed the case on grounds that the prosecutors never actually proved that the scopes in question were defense articles and governed by the ITAR.

Now this is where the case gets interesting and exporters worldwide may want to take note. The 7th Circuit U.S. Court of Appeals in Chicago overturned Pulungan’s guilty conviction on grounds that the ITAR regulations “were so vague, the defendant could not be held responsible for violating such vague regulations.” The appeals court went on to explain that, “the government failed to properly identify which specific items were subject to export control regulations, or to justify criteria for controlling them.” Apparently the vague, catch-all controls of the ITAR may have finally caught up with DDTC, the court stated that the State Department’s claim of “authority to classify any item as a “defense article,” without revealing the basis of the decision and without allowing any inquiry by the jury, would create serious constitutional problems.”

The appeals court wanted to make a point, and they did. They upheld that in regular circumstances a regulation is published for all the public to see so that people have an opportunity “to adjust their conduct to avoid liability.” But, “a designation by an unnamed official, using unspecified criteria, put in a desk of a drawer, and taken out only for use at a criminal trial, and immune from any evaluation by the judiciary, is the sort of tactic usually associated with totalitarian regimes.” This being said, many outside observers are suggesting this ruling may have an effect on export controls and violations, especially those surrounding the ambiguity of the ITAR which often gives the State Department tremendous leeway in determining what is or is not a “defense article.”

More information:


Gonzales and Justice Department Raises Their Export Control Enforcement Profile

2007/06/30

2007/06/30

The first-ever National Export Control Coordinator for the Department of Justice was appointed last June 20, 2007. Steven W. Pelak, a veteran prosecutor for 18 years, has been an Assistant U.S. Attorney and Senior Litigation Counsel in the National Security Section of the U.S. Attorney’s Office for the District of Columbia and, since September 2001, has served as the Anti- Terrorism Coordinator for the U.S. Attorney’s Office. Mr. Pelak is detailed to the Counter-espionage Section of the Justice Department’s National Security Division, wherein he will have some of the following responsibilities:

  • development of comprehensive training materials on export control investigations and prosecutions for federal prosecutors nationwide
  • solicit and receive regular progress reports from U.S. Attorneys’ offices on the development of export control cases
  • coordinate between the Justice Department and the many other U.S. law enforcement, licensing and intelligence agencies that play a role in export enforcement.

Attorney General Alberto Gonzales mentioned in his June 11 speech on nuclear terrorism that the Justice Department’s National Security Division where federal prosecutors were provided instruction and guidance on export control cases, with trainers from the Justice Department and the relevant investigative agents on hand providing comprehensive prosecutorial instruction.

(more…)


State Department Announces Policy Change for Arms Exports to Indonesia

2006/04/02

2006/04/02

By: John Black

In the March 29, 2006 Federal Register the Directorate of Defense Trade Controls (DDTC) in the State Department officially announced its new policy for approving exports to Indonesia. DDTC now will consider requests to export lethal defense articles on a case-by-case basis, which is a return to a more or less regular licensing policy for Indonesia.

As early as 1999 the State Department implemented a policy to deny most exports of defense articles to Indonesia. Over the last seven years State has implemented incremental relaxations to its policy. The March 29 Federal Register notice gives a brief history of those changes (http://www.access.gpo.gov/su_docs/fedreg/a060329c.html).


New ITAR Licensing Policy for Indonesia

2006/01/30

2006/01/30

By: John Black

DDTC announced that the US Government has decided to end its ban on the export of lethal defense articles and related services to Indonesia. Eventually, the government will announce this policy with a notice in the Federal Register.

What does the policy mean in terms of what licenses and agreements will be approved? DDTC says that applications for exports of lethal defense articles and services to the Indonesian armed forces “will be considered on a case-by-case basis, in accordance with standard practice,” which does not tell you a whole lot. Bottom line: It is worth considering new business in Indonesia , if you want to give it a try, before you get too involved you might want to contact DDTC and discuss what you are considering.


State Department Relaxes License Approval Policy for Indonesia

2001/12/30

2001/12/30

By: John Black

In the December 18, 2001 Federal Register the he Office of Defense Trade Controls (ODTC) in the State Department has announced a new license review policy for Indonesia. Under the new policy, ODTC will review license/agreement request for the following on a case-by-case basis.

  • Non-lethal defense articles and spare parts
  • Non-lethal, safety-of-use spare parts for lethal end items.

ODTC said that examples of safety-of-use spares for lethal end items would include cartridge actuated devices, propellant actuated devices, and technical manuals for military aircraft for purposes of enhancing the safety of the aircraft crew.

ODTC defines “non-lethal defense articles” as “an article that is not a weapon, ammunition or other equipment or material that is designed to inflict serious bodily harm of death.”

In October 1999, ODTC suspended all licenses and approvals for Indonesia except for certain commercial communication satellites and Y2K activities not destined for the military in response to the unrest in the country. ODTC relaxed this policy twice in 2001: In January it announced a policy of case-by-case review for spare parts for C-130 aircraft and in March it announced a case-by-case review policy for items exported to Indonesia for ultimate end-use in a third country.

By implementing a “case-by-case review” policy, ODTC is saying that it will not automatically deny licenses, but will review them on their merits.

ODTC gave no reason for relaxing its Indonesia policy, but we suspect the new policy is a reward for Indonesia’s cooperation in the aftermath of the September 11 attack-a reward we predicted in our newsletter in September.


State Department Announces Slight Change to Indonesia License Policy

2001/03/22

2001/03/22

By: John Black

In the March 22, 2001 Federal Register the Office of Defense Trade Controls (ODTC) in the State Department announced a slight change to its presumption of denial for export licenses for items on the United States Munitions List destined for Indonesia. Under the new policy, the State Department will consider applications for exports and reexports to Indonesia, when such shipments are ultimately destined for a third country. State announced that it will review such requests on a “case-by-case basis.”


State Announces Approval Policy for C-130 Spare Parts to Indonesia

2001/01/25

2001/01/25

By: John Black

In the January 25, 2001 Federal Register the Office of Defense Trade Controls issued a notice stating that it will consider approving license applications for C-130 spare parts destined for Indonesia, including in certain cases when destined for the Government of Indonesia.