Export Compliance and Audits: How to Minimize Risks in 2016 and Beyond
Exporting today is complicated, highly regulated, and often risky. The regulations continue to change, enforcement increases, and the risk of non-compliance, fines, and litigation grows each year. The largest fines are for willful, criminal convictions currently are up to $1 million, but will increase to $10 million, or ten times the value of the export, when the new Export Administration Act is passed.
In 2014, a number of firms and individuals were convicted of export violations including, a) Wind River Systems which agreed to pay $750,000 to settle allegations that it had transferred encryption software to those on the BIS Entity List, b) Robbins & Myers Belgium S.A pled guilty to the illegally exporting drilling equipment to Syria, paying $1,000,000 in criminal fines for $31,716 in equipment; and c) an individual pled guilty to conspiracy to illegally export laboratory equipment from to Syria and is facing up to five years in prison and a fine of as much as $250,000. The Justice Department and State Department pursued similar cases against companies and individuals in 2014 -- raising awareness within these organizations regarding the need to understand how companies conduct their business.
To cope with the increasing complexity and changeability of the export industry, companies need to develop, implement, and maintain effective Export Compliance and Audit management policies and procedures. Staff should be trained, monitored, and evaluated; risk analysis models should be reviewed and evaluated annually as well as on an as needed basis; and all programs should be audited to ensure compliance. The complexity and variability of restricted export lists counsels that entities consider using automated databases.
The Knowledge Group has assembled a panel of key thought leaders and professionals who will review recent export violations and help the audience understand the most important aspects of Export Compliance and Audits: How to Minimize Risks in 2016 and Beyond. The speakers also will share their best practices for maintaining an efficient and effective export compliance strategy and auditing process.
Key topics include:
- Export Administration Act and the Arms Export Control Act
- Export Compliance Program and Auditing Process – An Overview
- Developing an Export Auditing Program
- Performance Indicator (KPI) Monitoring Techniques
- Effective Export Compliance Monitoring and Auditing
- Automation of Export Compliance
- Identifying Risk Factors based on Export Reform
- Export Risk Models
- Policies and Procedures of Export Compliance & Auditing Program
- Safeguards and Standards of Conduct in Export Compliance
- Sanctions for Violation of Export Controls
- Export Compliance Security
- Best Practices
Fragomen, Del Rey, Bernsen & Loewy, LLP
- Audit types, approaches and frequency
- Understanding your business and how this impacts scope
- Developing audit responses and corrective actions
- Leveraging data to effectively conduct export risk assessments and audits
- Process reviews and identification of manual/systematic gaps that lead to export control risk
- Assessment of controls related to authorizations, blanket licensing, government reporting
- Re-exports controls
- Effectively communicating risk to management
- Health checks and auditing of automated systems for export control management
Dentons US LLP
- Objectives of an effective export audit - scope of objectives
- Choosing the correct auditor is fundamental to an effective audit -- factors to consider
- Protecting export audit results and/or reports under the attorney client privilege or attorney work product protections - how to protect the results and recent case law that affects the analysis; and
- Addressing export (or other) violations uncovered by the audit.
Covington & Burling LLP
- Best practices for oversight of third parties (e.g., suppliers, distributors and freight forwarders)
- Types and frequency of audits of third parties
- Audits of compliance with U.S. export controls by non-U.S. companies
- Reexport controls and considerations
Who Should Attend:
- Export Compliance Counsel
- Export Control Consultants
- Export Control Vice Presidents, Directors and Managers
- Private and Public Companies
- Other Related/Interested Professionals and Organizations
Steven Brotherton manages Fragomen's Export Controls Practice Group. He counsels clients on export control regulations and handles matter ranges from investigations and enforcement actions to the development of compliance programs, export licensing, classification, and audits. At the start of his career, he was in-house at The Boeing Company working on export control matters before joining Fragomen in 2001. Mr. Brotherton is a member the U.S. Department of Commerce’s Regulations and Procedures Technical Advisory Committee and is also the Co-Chair of TechAmerica's Export Control Reform Subcommittee. In connection with audits, Steven has conducted a number of audits including a number of DDTC directed audits, global audits covering domestic and foreign locations, and audits used successfully as mitigation in both criminal and civil government investigations.
Steven Brotherton manages Fragomen's Export Controls Practice Group. He counsels clients on export control regulations and handles matter ranges from …
George is a principal with KPMG LLP’s U.S. Trade and Customs Practice based in the firm’s Atlanta office and KPMG’s Trade and Customs Southeast Regional Leader. George has over 13 years of experience managing trade compliance and identifying efficiencies through implementation of effective controls.
George is responsible for assisting a broad range of U.S. multi-national and foreign-owned clients in industries including electronics and communications, mining, defense, automotive and retail and has experience with a wide variety of complex trade matters. George has extensive knowledge in U.S. export regulations, particularly in the areas of EAR and ITAR process development and compliance assessments, OFAC compliance and AES reporting. George has also managed large customs and export related projects and has assisted companies to identify various customs savings opportunities.
George is a principal with KPMG LLP’s U.S. Trade and Customs Practice based in the firm’s Atlanta office and KPMG’s …
Giovanna M. Cinelli is a partner at Dentons US LLP in their Tysons Corner, Virginia office where she chairs the Firm's Export Controls and National Security practice. She counsels defense and high technology companies on a broad range of issues affecting national security, including export compliance, CFIUS reviews and classified investigations. She has practiced for over 25 years handling dozens of complex civil and criminal investigations (both unclassified and classified), transactional due diligence, export licensing and interpretations, and negotiation of export enforcement settlements.
Ms. Cinelli also serves as an expert witness on export issues affecting litigations and arbitrations involving controlled goods, technologies, data and services. Her testimony has addressed complicated, multinational licensing and compliance issues related to the conduct of discovery and trial proceedings in the United States and abroad. Ms. Cinelli was listed in Chambers Lawyers Research as a specialist in export compliance, a 2014 Chambers USA "Leader in Their Field" for export controls and sanctions, a Chambers Global 2015 expert, as well as a 2012-2014 Washington, DC "Super Lawyer." She is currently Chairman of Women in Aerospace, the United States' premier non-profit organization focused on addressing leadership and educational opportunities for women in the aerospace and aviation fields.
She has worked extensively with the Departments of State, Commerce, Defense and Treasury, as well as Energy and the military services. She was a member of the Department of State's Defense Trade Advisory Group (DTAG) from 1992 through 2008, holding the position of Vice Chair from 2006 through 2008. She was reappointed to the DTAG in 2014. She served on the Department of Commerce's Regulations and Procedures Technical Advisory Committee (RPTAC) for 8 years, ending her tenure as Vice Chair. She has been a member of the Virginia/DC District Export Council since 2011 and is currently serving her second term.
Ms. Cinelli has lectured and written extensively on international arms trades, technology transfer and export issues, with two book chapters and dozens of scholarly articles to her credit. She has appeared on CNN's Burden of Proof and MSNBC's Hardball with Chris Matthews as an expert in international technology transfer, arms exports and related national security issues. In addition to her legal career, Ms. Cinelli served as a Naval Reserve Intelligence Officer specializing in former Soviet submarine platforms and international security issues. She holds a Masters in international relations from the College of William and Mary and an Executive Education Certification in National Security and International Security from the John F. Kennedy School of Government at Harvard University. She graduated from Catholic University School of Law where she was Editor-in-Chief of the Law Journal. She is fluent in Italian and French and lives with her family in Virginia.
Giovanna M. Cinelli is a partner at Dentons US LLP in their Tysons Corner, Virginia office where she chairs the …
Damara Chambers is a special counsel in the Washington, D.C. office of Covington & Burling LLP. Her practice focuses on national security law, cross-border investment issues and the application of international trade controls. Ms. Chambers advises companies on compliance and enforcement matters relating to US export controls administered by the Departments of State, Commerce, and Energy and the Nuclear Regulatory Commission, economic sanctions administered by the Department of the Treasury, and import and licensing requirements imposed by the Bureau of Alcohol, Tobacco, Firearms and Explosives. She also has extensive experience handling complex regulatory matters relating to international investment and mergers, including advising foreign and domestic clients in successful national security reviews before the Committee on Foreign Investment in the United States (CFIUS) and advising companies regarding the mitigation of foreign ownership, control or influence (FOCI) under national industrial security regulations administered by the Defense Security Service (DSS) and Department of Energy.
Damara Chambers is a special counsel in the Washington, D.C. office of Covington & Burling LLP. Her practice focuses on …
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About Fragomen, Del Rey, Bernsen & Loewy, LLP
Fragomen's Export Controls Practice Group provides a wide range of export control services to companies of all sizes in all industries. These services include development and implementation of global export control management systems, preparation of EAR, ITAR and OFAC export license applications, deemed export reviews, training, representation in government investigations and enforcement actions, and preparation of voluntary self-disclosures and related mitigation plans.
KPMG LLP provides assurance, tax, and financial advisory services. The firm offers accounting, auditing, internal audit, regulatory and compliance, corporate recovery, forensic accounting, and risk management services. It also provides transaction advisory services such as due diligence, target risk assessment, acquisition accounting and tax advisory, and divestiture accounting. KPMG’s Trade and Customs practice’s dedicated professionals in over 10 cities in the U.S., and over 350 professionals globally serve multinational companies with their export risk management and improvement through internal audit services, export strategic planning, process development, and export management technology implementation.
About Dentons US LLP
Dentons is a global law firm organized to provide you with a competitive, legal and policy edge in an increasingly challenging and complex environment. As a market leader in multiple jurisdictions, Dentons was formed in 2013 through a combination of Salans LLP (Dentons in Europe), Fraser Milner and Casgrain LLP (Dentons in Canada) and SNR Denton (Dentons US). In June 2015, McKenna Long and Aldridge merged with Dentons US to further expand its geographic reach and capabilities.
Dentons spans over 80 locations in 50-plus countries across the United States, Europe, Asia Pacific, Canada, Africa, the Middle East, Central Asia, Russia, the CIS and the Caucuses, and the United Kingdom. The Firm provides access to top-tier legal talent with experience in over 24 sectors, including, but not limited to: Aviation and Aerospace, Defense, Software, High Technology, Telecommunications, Real Estate and Banking. The Firm maintains expertise in over 39 practice areas covering mergers, acquisitions, divestitures, export controls, national security, government contracts, litigation, financing, immigration and cross-border requirements (such as CFIUS and other foreign direct investment laws). With a global reach and in-depth experience, Dentons helps clients across the globe expand their opportunities and remain competitive.
About Covington & Burling LLP
Covington & Burling LLP is a full-service firm with approximately 850 lawyers in offices in Beijing, Brussels, London, New York, San Diego, San Francisco, Seoul, Shanghai, Silicon Valley and Washington. Covington practices as one firm, holding closely to core values that start with a deep commitment to our clients and the high quality of our work on their behalf, and that include an emphasis on teamwork among our lawyers and other professionals and a belief in the obligation of lawyers to make legal services available to all who need them.