U.S. Department of Justice updates Summary of Major Prosecutions Export Controls & Embargoes

U.S. Department of Justice updates Summary of Major Prosecutions Export Controls & Embargoes  

The U.S. Department of Justice (DOJ) published another update of its summary of major export controls and embargo prosecutions. The summary also includes economic espionage and theft of trade secrets prosecutions. Note that DOJ periodically publishes the summary.

The question is whether the U.S. policy is effective?

In most cases, its non-U.S. companies which are targeted by the U.S. Government. Think of the whacking high settlements regarding Deutsche Bank and BNP Paribas. The long arm of the U.S. Government can impact global operating companies. In many cases, U.S. enforcement can be seen as a license to operate, if an organization doesn’t play ball, they can be effectively isolated from doing business with U.S. companies worldwide. 

The issue is whether penalizing global operating companies with high fines and demanding organizations to change their corporate governance ex post sanctions instead of ex ante measures is the best way to go. This signals not only a failure of the private sector, but most certainly from regulators. However, its interesting to see that most of the major enforcement cases are done with foreign, not U.S., companies. Many have cited that U.S. prosecutors, often with political ambitions, target foreign companies because these are easier to explain to the U.S. public (better said placate their sense of injustice). This could be true, however, in reality, it’s easier to penalize friends, e.g. companies of allied countries – European countries, because they have the most to lose with non-compliance.  

Further, international co-operation concerning enforcement should be increased; for instance, there is growing criticism that the U.S. Government’s demand for billions of dollars in damages are disproportional. Yes, corporate misdeeds should be punished, I’d be the last to defend the misconduct of corporate officers, not to mention bankers. However, there could be more effective measures possible. If its possible to create black-lists for terrorists, why can’t black-lists be created for corporate officers who have amassed wealth by pursuing unethical policies. The best way to hurt such people is to go after their wallets permanently. It would really hurt them if they were black-listed from ever being able to have senior positions in companies or financial institutions. It could also be an effective deterrent for those wishing to pursue unethical conduct.  

What is contained in the summary?

The summary is an overview of the major U.S. export enforcement, economic espionage, theft of trade secrets, and embargo-related criminal prosecutions by the DOJ since 2009. This list of prosecutions is not exhaustive and only represents select cases. These prosecutions are based on investigations by various U.S. law enforcement agencies. These include for example:

  • the Homeland Security Investigations (formerly Immigration and Customs Enforcement (ICE))
  • the Department of Commerce’s Bureau of Industry and Security (BIS)
  • the Pentagon’s Defense Criminal Investigative Service (DCIS)
  • the Federal Bureau of Investigation (FBI)

Added value of the Summary?

The summary is primarily useful for reference purposes; especially for compliance professionals (e.g. training) or researchers. The summary gives the reader prosecutions per country and the related U.S. law/regulations which lead to the prosecutions.

Unfortunately, the summary, compared to the BIS “Don’t Let this Happen to You!” is not categorized per industry, which is a pity. In this context, the summary is another example of the complex bureaucratic environment surrounding the enforcement of U.S. export controls and sanctions. Other sites where one can find enforcement information are: BIS, DDTC (note that major export enforcement cases button refers the reader to DOJ summary) and OFAC

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