Responding to an Export Control Civil Investigative Demand (Administrative Subpoena)
So your probably holding this administrative subpoena from DDTC or BIS about export violations and your entire defense business is about to be destroyed. Maybe you exported technical data without a license. Maybe someone accessed ITAR-controlled information who shouldn’t have. Or maybe your just caught up in there latest enforcement sweep. Look, we get it. Your ABSOLUTELY PETRIFIED. And you should be! Because export violations carry 20 YEARS in federal prison and $1 MILLION fines – PER VIOLATION!
What Makes Export Control Investigations So Terrifying?
Let me explain the national security nightmare your facing. BIS’s Office of Export Enforcement has FEDERAL AGENTS with guns, badges, and arrest authority! There the only federal law enforcement dedicated exclusively to export control!
DDTC and BIS don’t need warrants – they issue administrative subpoenas demanding everything! Your servers, emails, visitor logs, technical data, export records – ALL OF IT! Refuse to comply? Federal marshals arrest you for obstruction! We’ve seen executives handcuffed at there desks for not producing documents fast enough!
Here’s what’s really scary – civil violations don’t require intent! Didn’t know that email to a foreign national was an “export”? TOO BAD! Thought the fundamental research exception applied? WRONG! One accidental disclosure can trigger millions in penalties plus criminal prosecution!
How Devastating Are Export Control Penalties?
Sit down and prepare for numbers that will destroy everything you’ve built!
ITAR violations carry civil penalties up to $1.2 MILLION per violation or twice the transaction value – whichever is GREATER! Exported $10 million in defense articles? That’s $20 MILLION in penalties! Plus criminal fines up to $1 million! Plus 20 years prison!
EAR violations are equally crushing – $300,000 per violation or twice the value! But here’s the killer – EACH EXPORT is a separate violation! Sent 100 emails with technical data? That’s 100 violations = $30 MILLION in potential penalties! We’ve seen small manufacturers bankrupted by penalties for routine communications!
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(212) 300-5196What About Criminal Prosecution for Export Violations?
ABSOLUTELY! And its happening MORE frequently! In 2017 alone, BIS got 31 criminal convictions with $287 million in fines and 576 months imprisonment!
The Arms Export Control Act makes willful violations FELONIES! Each unauthorized export, each false statement, each missing record is a separate count! Stack them up and executives face DECADES in prison! We’ve seen engineers imprisoned for sharing technical data at conferences!
Recent prosecutions are terrifying – executives debarred for LIFE from defense industry! Unable to work in there field ever again! One client’s son couldn’t get security clearance because dad had export violation 20 years earlier!
Todd Spodek
Lead Attorney & Founder
Featured on Netflix's "Inventing Anna," Todd Spodek brings decades of high-stakes criminal defense experience. His aggressive approach has secured dismissals and acquittals in cases others deemed unwinnable.
What Triggers Export Control Investigations?
Your probably wondering “How did they find out?” Let me tell you what destroys exporters:
Your defense contracting company just received a Civil Investigative Demand from the Bureau of Industry and Security demanding five years of export records, internal compliance audits, and employee communications related to shipments of dual-use encryption technology to a subsidiary in Singapore. You have 30 days to respond, but producing everything they've asked for could expose additional transactions you're not even sure were properly licensed.
Should we comply fully with the CID or can we push back on the scope of what BIS is demanding?
You have the right to negotiate the scope of a Civil Investigative Demand under the Export Control Reform Act (ECRA, 50 U.S.C. § 4820) and the EAR (15 CFR Part 764), and experienced counsel can often narrow overly broad requests through formal objections or informal discussions with the issuing office. However, outright refusal or destruction of responsive documents can trigger obstruction charges under 18 U.S.C. § 1519 and convert what might be a civil penalty case into a criminal referral. We would immediately implement a litigation hold on all potentially responsive materials, conduct a privileged internal review to identify any problematic transactions before production, and engage directly with BIS enforcement counsel to negotiate reasonable limitations on the demand's scope. Early cooperation — done strategically and with proper legal safeguards — often results in significantly reduced penalties under BIS's voluntary self-disclosure framework outlined in 15 CFR § 764.5.
This is general information only. Contact us for advice specific to your situation.
Whistleblowers and competitors routinely report violations! That fired employee who knows about your exports? They’re calling DDTC! Competitor who lost a contract? Claiming you violated ITAR! Even routine customs inspections trigger investigations!
“Directed disclosures” are the worst – DDTC already knows about violations and demands you confess! Not truly voluntary so no mitigation credit! But if you don’t respond completely, they assume your hiding worse violations! We’ve seen companies forced to admit violations they didn’t even know existed!
