U.S. Resolves Meggitt's Export Violations

  • Our Bureau
  • 02:49 PM, August 26, 2013
  • 2529

The U.S. State Department concluded an administrative settlement with Meggitt-USA, Inc. to resolve alleged violations of the Arms Export Controls Act and the International Traffic in Arms Regulations ("ITAR").

Meggitt agreed to enter into a consent agreement with the U.S., highlighting the ensured compliance with the AECA and ITAR.

The settlement was reached after an extensive compliance review in the Bureau of Political-Military Affairs of multiple disclosures submitted by Meggitt group subsidiaries involving hundreds of potential civil violations of the AECA and ITAR, of which sixty-seven are alleged as charges.

Over the course of several years, Meggitt subsidiaries and business units disclosed to the Department hundreds of ITAR violations beginning in the mid-1990s, largely involving the unauthorized export of defense articles, including technical data, the unauthorized provision of defense services, violation of the terms of provisos or other limitations of license authorizations, and the failure to maintain specific records involving ITAR-controlled transactions.

Under the terms of the 30-month consent agreement with the Department, Meggit is assessed a civil penalty of $25 million, of which $3 million will be paid in installments and the remainder suspended on the condition the Department approves expenditures for self-initiated, pre-consent agreement remedial compliance measures and consent agreement-authorized remedial compliance costs.

In addition, an Internal Special Compliance Official will be engaged by Meggitt to oversee the consent agreement, which will also require the company to implement additional compliance measures, including enhanced policies and procedures, to review external audit programs and conduct audit measures pursuant to the agreement, to review jurisdictional determinations of commodities, and report on system upgrades and improvements. 

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