Recently in Arms Export Control Act Category

Man Pleads Guilty to Violating Arms Export Control Act by Selling Unmanned Aerial Vehicle on Ebay

August 1, 2011, by The McKellar Law Firm, PLLC

A guilty plea was entered in federal court last week in a case involving the illegal importation of an unmanned drone according to an announcement by the Department of Justice. Henson Chua was indicted in March for trying to sell an unmanned aerial vehicle known as a "Raven" in violation of the Arms Export Control Act ("the Act"). The Act prohibits buying and selling certain military items without a license, and the Raven is such an item.

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According to the facts outlined in the plea agreement, the Department of Homeland Security and Immigrations and Customs Enforcement ("ICE") learned that an unmanned drone was listed for sale on eBay for $13,000. Homeland Security agents began an investigation with an undercover agent posing as a potential buyer. The "buyer" informed Chua that he planned to resell the drone outside the United States after receiving it from Chua. The agents purchased and received the drone last year. Chua was arrested earlier this year when he entered the US.

Chua pled guilty to one count of causing the temporary import of a defense article without authorization under 22 U.S.C. § 2778. This provision requires a party to obtain a license from the federal government before importing certain munitions. This section of the Act also provides penalties of imprisonment for up to 20 years, a fine up to $1 million, or both.

In announcing the plea, ICE agent Susan McCormick stated, "The unlawful import of military technology poses a serious threat to our national security. ICE is committed to working with the U.S. Attorney's Office and military investigators to protect the American public and our military troops overseas from this kind of technology falling into the wrong hands."

The alleged purpose of the Act is intended to do just that: prevent American military equipment and technology from reaching those who would use it against American interests. In this case, the Department of Homeland Security recovered the drone, but it's worth noting, however, how Chua claims he obtained the drone in the first place. Chua stated that he was able to purchase it at an auction conducted by the Philippine government. Apparently, the Philippine government considered the Raven to be abandoned property. While Chua's case represents a success for the prosecution in using the Act to prevent such equipment from potentially falling into the hands of arms dealers, criminals, or hostile governments - who apparently need only sign up for eBay to obtain it - the case also illustrates the limits of such laws when these items are already available for sale halfway across the globe. Buyer (and seller) beware.

Tennessee Company and Citizens Indicted for Violation of Arms Export Control Act

February 10, 2011, by The McKellar Law Firm, PLLC

Earlier this week, five individuals and a Nashville firearms manufacturer were indicted by a federal grand jury on charges relating to international firearms and trafficking violations of the Arms Export Control Act (AECA), according to a press release from the U.S. Attorney's Office for the Middle District of Tennessee. As discussed in an earlier blog post, the AECA is set forth in 22 U.S.C. § 2778, and this law provides the federal government with authority to control the export of defense articles and services.

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In this particular case, the Government alleges that the defendants were part of a scheme which began in 2003 to thwart U.S. import/export restrictions on firearms and their components. Assistant Attorney General Lanny A. Breuer of the Department of Justice claims, "The defendants allegedly went to great lengths to conceal their activities and evade U.S. laws - mislabeling packages, falsifying shipping records, and maintaining a fictitious set of books and records, among other things. The illegal trade of firearms and their components poses serious risks and, as this case shows, we cannot and will not tolerate it."

The indictment alleges that each of the defendants conspired to intentionally violate the AECA by causing firearms components, which are listed as "defense articles" on the United States Munitions List, to be exported from the United States to an international location without first obtaining a license or written authorization for such export from the Directorate of Defense Trade Controls of the United States Department of State. According to the indictment, the export of "defense articles," such as firearms or firearms components or other military items on the US Munitions List, are strictly controlled by the AECA and the International Trafficking in Arms Regulations (ITAR).

At this point, each of the defendants will soon appear in U.S. District Court in Nashville, Tennessee, for their Initial Appearance and Arraignment. At that time, the Court will address issues of pre-trial release and scheduling of important dates such as trial, motion deadlines, and plea cutoff deadlines.

Tennessee Man Pleads Guilty to Violating Arms Export Control Act

January 21, 2011, by The McKellar Law Firm, PLLC

Knoxville, Tennessee federal criminal defense lawyers won't often deal with violations of 22 U.S.C. § 2778, which is commonly referred to as the Arms Export Control Act (AECA). The AECA provides the federal government with authority to control the export of defense articles and services.

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Earlier this week, Jerome Pendzich of Hampton, Tennessee, pleaded guilty to violating the AECA here in U.S. District Court in Knoxville. According to an article by Jamie Satterfield in the Knoxville News Sentinel, Immigration and Customs Enforcement Agency (ICE) officials searched the internet to find sellers who were selling munitions and other weaponry which violated the AECA. ICE officials found Pendzich on Ebay offering "worldwide shipment" of a type of body armor which is governed by the AECA.

Federal agents set up a sting as they pretended to be customers from Bogota, Colombia. Pendzich mailed prohibited items to Colombia and labeled them as "gifts" and "ceramic plates." ICE agents raided Penzich's home in 2009, and he ultimately admitted that he knew his actions were illegal. Penzich has not yet been sentenced.

Violation of the AECA is governed in part by the United States Sentencing Guidelines Section 2M5.2. This section of the Guidelines provides a base offense level of 26 (which would be 63-78 months of imprisonment for Category I offenders) or a level of 14 if the offense involved only non-fully automatic small arms, and the number of weapons did not exceed ten. Level 14 provides a range of punishment of 15-21 months for Category I offenders. However, a downward departure from these ranges of punishments may be in order if the offense did not have the potential to be harmful to a security or foreign policy interest of the United States, as was the case with Pendzich.