Following a large U.S. Supreme Court decision ostensibly stripping the Federal Trade Commission of the authority to seek monetary relief from companies and individuals engaged in unfair or deceptive acts (see 2104220043), the agency may not be out of options to convey the long arm of the law into the scammers' pockets, Sidley Austin said in a May 6 analysis. For one, the FTC still has the power to obtain an injunction in federal court to continue stopping unlawful conduct. For another, the agency can use Section 19 of the FTC Act to obtain monetary relief. The provision allows a federal court to grant a financial award to the FTC after the agency has issued a final cease-and-desist order and proven that the subject act or practice accused of being fraudulent was committed knowingly. However, the Section 19 route is a lengthier process since it can only be employed after the FTC obtains a final cease-and-desist order.

Following the Department of Justice's first resolution of action under a new export control tool, greater efforts should be made to conduct export-related due diligence and act on those recommendations, according to a May 6 analysis from Sidley Austin. Merely conducting audits of exports and sanctions is not good enough anymore, Sidley said. Implementing audit recommendations and putting in place a robust process to receive, investigate and elevate whistleblower complaints should be a priority following the DOJ's settlement with German software company SAP SE.

The State Department fined a U.S. aerospace and technology company $13 million for illegally exporting technical data to several countries, including China, according to a May 3 order. Honeywell International sent drawings of parts for military-related items, including for engines of military jets and bombers, the agency said, all of which were controlled under the International Traffic in Arms Regulations. After discovering the violations, issuing a self-disclosure to the State Department and bolstering its compliance program, the company again illegally exported technical drawings, failing to abide by its improved compliance requirements, the order said.

At the same time that trade-related False Claims Act cases cover an increasing number of types of allegations against importers and exporters, the rewards doled out to whistleblowers seems to be on the rise, Sidley Austin said in an April 29 analysis. Discussing increasing trade exposure in FCA cases in part two of a series on the practice (see 2104210028), Sidley said there is a trend of increased payout size. "These factors foreshadow an increase in trade-related FCA actions in the near future,” the firm said.

San Diego-based tungsten products manufacturer Tungsten Heavy Powder settled a False Claims Act allegation for $5.6 million for false origin claim, the U.S. Attorney's Office for the Southern District of California said in an April 29 news release. The producer was accused of falsely certifying that it sourced materials from the U.S. for items made under contract with the government of Israel, funded by the U.S. Defense Security Cooperation Agreement Agency. The U.S. accused THP of falsely declaring that its Chinese-origin tungsten from China was from the U.S. The U.S. also alleged THP falsely certified that manufacturing occurred in the U.S., when it instead produced its products via a contract with a Mexican maquiladora factory.

Yang Sui, a resident of Niskayuna, New York, was sentenced to one year of probation and to pay a $5,000 fine for stealing trade secrets from General Electric Company, the U.S. Attorney's Office for the Northern District of New York announced in an April 30 press release. Sui admitted he stole multiple electronic files containing insider information about the research, development, design and manufacture of silicon carbide metal-oxide semiconductor field-effect transistors (MOSFETs) from GE, the release said. He admitted to also planning to establish his own rival company to sell MOSFETs; however, there was no evidence that Sui traded the secrets to any other party, it said.

Granite Bay, California, resident Saed Ismail Amiri pleaded guilty to a scheme to defraud the Afghan government of over $100 million relating to a contract to build an electric grid in the country, the Department of Justice said in an April 28 news release. The U.S. Agency for International Development provided money for the grid via a U.S.-funded contract to create five electric power substations connecting Afghanistan's Northeastern and Southeastern grid systems in 2015 and 2016. During that time, Amiri owned or was the senior consultant for Afghan company Assist Consultants Inc. and engaged in a scheme to obtain the $100 million contract by submitting a false work history and fraudulent supporting documents. Using the documents, Amiri deceived the Afghan government into believing ACI met project requirements. Amiri subsequently lied to U.S. law enforcement at the U.S. Embassy in Afghanistan.

Shuren Qin, a Chinese national living in Wellesley, Massachusetts, pleaded guilty to illegally causing the export of more than $100,000 worth of U.S.-origin goods to Chinese military university Northwestern Polytechnical University, the U.S. Attorney's Office for the District of Massachusetts announced in an April 28 news release. Qin pleaded guilty to a litany of charges including conspiracy to unlawfully export items without an export license, visa fraud, money laundering and smuggling hydrophones from the U.S. to China, the Justice Department said. The illegally exported goods consisted of technology with underwater and marine applications to allegedly be used for NWPU's development of unmanned aerial vehicles, autonomous underwater vehicles and missile proliferation projects, Justice said. To import the goods, Qin created LinkOcean Technologies, subsequently sending the goods to China from the U.S., Canada and Europe.

Donville Inniss, former Barbados minister of industry and Parliament member, was sentenced to two years in prison for helping launder bribe payments from an insurance company in his home country through bank accounts in New York, the Department of Justice announced in an April 27 news release. In 2015 and 2016, Inniss laundered around $36,000 in bribes from executives of Insurance Corporation of Barbados in exchange for contracts between the insurance company and the Barbados government. Inniss, who lived in Tampa, Florida, and Barbados, helped secure the contracts, worth over $100 million, due to his government position, DOJ said.

The U.S. government seized an oil tanker for delivering petroleum products to North Korea in violation of U.S. sanctions and charged a Singaporean national with conspiracy to evade sanctions, the U.S. Attorney's Office for the Southern District of New York said in an April 23 news release. Kwek Kee Seng of Singapore and the ship, the M/T Courageous, allegedly brought oil to North Korea via ship-to-ship transfers with North Korean ships and direct shipments to the North Korean port of Nampo. The transfers allegedly took place August-December 2019 when the ship stopped transmitting its location. DOJ said satellite imagery revealed the Courageous engaging in the ship-to-ship transfers of more than $1.5 million worth of oil to an OFAC-designated North Korean ship.