Why Voluntary Self-Disclosure of National Security-Related Transgressions is Critical for Defense-Related Businesses
By Jason Martin
Regulatory compliance is critical for any business involved in the export of defense related commodities. Violations under the International Traffic in Arms Regulation (ITAR) or the Export Administration Regulations (EAR) can be met with harsh monetary penalties and fines as well as civil or criminal action depending on the cause and type of violation. Failing to follow these export control requirements can be the worst nightmare for any “C-Suite” executive.
As ominous as all of this sounds, there is little benefit to letting a suspected or known violation go unaddressed. The proper course of action should be to 1) determine with counsel if it appears a legal violation occurred, and 2) if so, voluntarily disclose it to the appropriate agency within the U.S. Government under the process known as “voluntary self-disclosure” or “VSD.”
For defense contractors, adherence to ITAR requirements is a top-level concern that should be addressed in any regulatory compliance program the contractor implements. Business fines, personal civil and criminal penalties, and loss of export licenses can damage and disrupt a small enterprise to a point where recovery might well be unlikely.
How U.S. National Security Policy Impacts Your Company’s Data Policies
By Jason Martin
Even a layperson understands that the U.S. government regulates the export of military hardware. Defense contractors involved in such international transactions adhere to the International Traffic in Arms Regulation, or ITAR (See 22 CFR Parts 120-130), which governs the manufacture, export, and temporary import of defense articles, the furnishing of defense services, and brokering activities involving items described on the United States Munitions List. However, the ITAR story does not begin and end with the export of controlled physical items out of the United States. Data controls are also an essential part of the regulations.
For defense contractors, adherence to ITAR requirements is a top-level concern that should be addressed in any regulatory compliance program the contractor implements. Business fines, personal civil and criminal penalties, and loss of export licenses can damage and disrupt a small enterprise to a point where recovery might well be unlikely.