What happens if I violate export controls in the USA? (January – December 2022)

DDTC Concludes $840,000 Settlement of Alleged Export Violations by Torrey Pines Logic, Inc. and Dr. Leonid B. Volfson

The U.S. Department of State’s Directorate of Defense Trade Controls (DDTC) has concluded an administrative settlement with Torrey Pines Logic, Inc. (TPL) of San Diego, California, and Dr. Leonid B. Volfson, to resolve alleged violations of the Arms Export Control Act (AECA) and the International Traffic in Arms Regulations (ITAR). This agreement pursuant to ITAR § 128.11 resolves alleged ITAR violations involving the attempted unauthorized export of defense articles; the unauthorized export of defense articles to various countries, including the People’s Republic of China and Lebanon, which are proscribed destinations under ITAR § 126.1, and Russia, a country that was, at the time of the violations, subject to restrictive measures on defense exports per the Department of State public announcement on April 28, 2014; the involvement in ITAR-regulated activities while ineligible; and the failure to maintain and produce records. Under the terms of the 36-month Consent Agreement, TPL and Dr. Volfson will pay a civil penalty of $840,000. DDTC has agreed to suspend $420,000 of this amount on the condition that the funds will be used for DDTC-approved Consent Agreement remedial compliance measures to strengthen TPL’s compliance program. In addition, for the duration of the Consent Agreement, an external Special Compliance Officer will be engaged by TPL to oversee the Consent Agreement, which will also require the company to conduct one external audit of its compliance program and implement additional compliance measures. These terms reflect the cooperation TPL and Dr. Volfson provided to the Department. They submitted a voluntary disclosure, which included a third-party audit report that identified various export violations; cooperated with the Department’s investigation by responding to numerous requests for additional information; and entered into successive agreements with the Department extending the statute of limitations period for certain violations. Click on the links below for further details: