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Defense Related Disclosures to Foreign Nationals

Published by on September 5, 2008

Companies involved in producing products or components of products to be used in US defense systems should take note of the following case. A plasma technology company located in Knoxville, Tennessee has plead guilty to ten counts of illegally providing a Chinese national with technological data used in the development of an unmanned aerial weapons […]

Companies involved in producing products or components of products to be used in US defense systems should take note of the following case.

A plasma technology company located in Knoxville, Tennessee has plead guilty to ten counts of illegally providing a Chinese national with technological data used in the development of an unmanned aerial weapons system in violation of the Arms Export Control Act.  The maximum punishment for each offense includes a $1 million fine and a maximum 5 year probation term.  Three agencies, the FBI, the US Air Force Office of Special Investigations, and the Immigration and Customs Enforcement branch collaborated in the investigation. 

In a related indictment, a university professor providing services to the company was also charged with taking restricted documents to China and e-mailing restricted documents to a foreign national.

This case highlights the need for employers to constantly screen the nationality of participants on various government contract projects.  US law prohibits the “export” of defense-related data to any foreign national or foreign nation.  Such disclosure of defense-related information is a ‘deemed export violation.’

Contributed by Robert R. Gillispie

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