Export Control and Sanctions Enforcement

The Office of Foreign Assets Control ("OFAC") at the U.S. Department of the Treasury has just advised your company that one of your overseas branch offices engaged in a prohibited financial transaction with a "Specially Designated National" ("SDN"). An internal audit has revealed that a U.S. person employed at one of your company’s overseas locations was involved in approving transactions in a sanctioned country. Your company's chief compliance officer has learned that a foreign national employee viewed technical data controlled for export under the International Traffic in Arms Regulations ("ITAR"): now you must consider whether to file a voluntary disclosure with the Directorate of Defense Trade Controls ("DDTC") at the Department of State. Special Agents from the Office of Export Enforcement ("OEE") at the Department of Commerce's Bureau of Industry and Security ("BIS") have just served a subpoena on your company for records regarding the transshipment of equipment parts to Iran by a foreign commercial partner, in violation of the Iranian Transactions and Sanctions Regulations. These are only a few examples of problems that companies engaged in foreign commerce confront in today's regulatory and enforcement environment.

David H. Laufman assists companies and individuals impacted by the scope and complexity of U.S. trade control laws. He assists parties in seeking specific licenses from OFAC for transactions otherwise prohibited by economic sanctions laws. Partnering with large investigative and compliance firms, he conducts internal investigations regarding possible violations of economic sanctions and export control laws, and is available to serve as a compliance monitor in cases where the government has required a monitor to resolve an enforcement matter. When appropriate, Mr. Laufman prepares voluntary disclosures to OFAC, DDTC, BIS, and the Department of Justice (“DOJ”). He also represents parties in administrative and criminal investigations for violations of U.S. export control and economic sanctions laws, including violations of Iranian sanctions programs.

Mr. Laufman's government experience in the enforcement of export control and sanctions laws substantially enhances his ability, as a defense attorney, to successfully represent clients with compliance problems or investigative concerns. As Chief of DOJ’s Counterintelligence and Export Control Section from late 2014 to early 2018, he oversaw the government’s criminal enforcement of export control and sanctions laws, working closely with the FBI, BIS, OFAC, and DDTC. Among the matters he oversaw were the criminal prosecutions of ZTE Corporation and Schlumberger Oilfield Holdings, Ltd. for, among other things, violations concerning U.S. sanctions against Iran. As Chief of CES, Mr. Laufman led efforts to enhance training for federal prosecutors regarding the willfulness requirement for criminally charging violations of U.S. export control and sanctions laws, and he played a substantial role in authoring both DOJ’s Strategic Plan for Export Control and Sanctions Enforcement, and its Guidance Regarding Voluntary Self-Disclosures, Cooperation, and Remediation in Export Control and Sanctions Investigations Involving Business Organizations. As a former Assistant U.S. Attorney specializing in national security offenses, he conducted criminal investigations of illegal export transactions. In 2000-2001, Mr. Laufman served as Staff Director and Deputy Chief Counsel of the Judicial Review Commission on Foreign Asset Control ("Commission"), a congressionally mandated organization that closely examined OFAC's administration of U.S. economic sanctions laws, including OFAC's procedures for designating parties as SDNs. Mr. Laufman coordinated the Commission's fact-finding and public hearings, and he co-authored and edited the Commission's two reports to Congress.

Representative Matters

  • Counseled a U.S. defense contractor regarding compliance with U.S. export controls in connection with a potential foreign business transaction.
  • Presented a successful trial defense in the case of United States v. Alavi, in which the government had charged an Iranian-American engineer employed at a nuclear power plant in Arizona with, among other things, unlawfully exporting computer software from the plant to Iran without a license from OFAC. Despite being retained as counsel only three weeks before trial, Mr. Laufman succeeded in obtaining a mistrial of the export control charge in the case, resulting in the government's subsequent offer of a plea agreement to lesser charges which dramatically reduced the defendant's sentence.
  • Counseled a senior official at a U.S. aerospace company regarding the scope and implications of a statutory debarment for a prior criminal violation of the Arms Export Control Act.
  • Submitted a disclosure to OFAC for a non-profit organization concerning the production of a documentary film in Iran, resulting in a no-action letter.
  • Conducted an internal investigation of a foreign company's re-export of U.S. goods to Iran.
  • Successfully petitioned OFAC to authorize the release and importation of seized musical instruments from Iran on behalf of an eminent Iranian-American musician. (See http://blogs.wsj.com/law/2008/04/25/law-blog-lawyer-of-the-day-david-laufman-friend-of-the-mini-dulcimer/.)
  • Counseled a start-up U.S. company engaged in international business operations on compliance with U.S. economic sanctions laws.

Related Publications

  • Man the Firewalls: Cyber Intrusions and Compliance Risks Under U.S. Export Control Laws, reprinted from Global Trade & Customs Journal, Vol. 8, Issues 11 & 12, November 2013, pages 382-389, with permission of Kluwer Law International
  • ITAR Risks From Cyber Intrusions, The Export Practitioner, June 2013 (PDF copy available upon request)
  • Cyber Intrusions: Export Control Risk and Compliance (presented to 2013 Spring Meeting of ABA Section of International Law, April 26, 2013)
  • OFAC Issues Final Sanctions Enforcement Guidelines, The Export Practitioner, December 2009 (PDF copy available upon request)
  • Litigating Intent in Export Control Prosecutions, The Export Practitioner, January 2009 (PDF copy available upon request)
  • Final Report to Congress, Judicial Review Commission on Foreign Asset Control, January 2001 (edited and co-authored)
  • Carter, International Economic Sanctions (Cambridge Univ. Press 1988) (research assistant)

Related Speaking Engagements

  • Navigating Parallel Sanctions Investigations: Challenges and Best Practices, 9th Annual New York Forum on Economic Sanctions, American Conference Institute, New York, New York, December 7, 2018 (moderator)
  • Perspectives From the Enforcement Authorities, Coping With U.S. Export Controls and Sanctions, PLI Conference, Washington, DC, December 15, 2017 (panelist)
  • Presentation on enforcement of U.S. export control and sanctions laws, National Council on International Trade Development, Washington, DC, November 8, 2017
  • Presentation on enforcement of U.S. export control and sanctions laws, OFAC practitioners’ group, Washington, DC, October 13, 2017
  • Speech on enforcement of U.S. export control and sanctions laws to Association of University Export Control Officers, St. Petersburg, Florida, May 16, 2017
  • Regulators’ Town Hall Q&A, ACI Conference on Economic Sanctions Enforcement and Compliance, Washington, DC, April 25, 2017 (panelist)
  • Economic Sanctions Year in Review: Agencies Speak on Enforcement and Regulatory Priorities, ACI Conference on Economic Sanctions Enforcement and Compliance, Washington, DC, April 24, 2017 (panelist)
  • Panelist on program concerning export control and sanctions enforcement, ABA’s Annual Institute on White Collar Crime, Miami, Florida, March 8, 2017
  • Speech on U.S. export control enforcement to C5 Advanced Forum on ITAR and the EAR, London, United Kingdom, January 31, 2017
  • Speech on the Justice Department’s enforcement of U.S. export control and sanctions laws to ABA Committee on Export Controls and Sanctions, Washington, DC, May 13, 2016
  • Liability for Cross-Border Activity: Increasing Enforcement of Economic Sanctions and Export Controls, ABA’s 30th Annual Institute on White Collar Crime, San Diego, California, March 2, 2016 (panelist)
  • Perspectives from the Enforcement Authorities, Coping with U.S. Export Controls and Sanctions 2015, PLI Conference, Washington, DC, December 18, 2015 (panelist)
  • Keynote address on U.S. export controls, cyber security, and the Justice Department’s new enforcement policy on individual corporate accountability to industry conference sponsored by Jones, Day, Washington, DC, September 15, 2015
  • Presentation on export control and sanctions enforcement to the National Council on International Trade Development, Washington, DC, May 13, 2015
  • How Best to Converse with the Government When Confronted by a Sanctions Violation, 8th Advanced Forum on Economic Sanctions Enforcement and Compliance, American Conference Institute, Washington, DC, April 29, 2015
  • Practitioners' Guide to U.S. Trade Controls, National Security Law, Policy & Practice Committee, Bar Association of the District of Columbia, Washington, DC, January 29, 2014 (moderator)
  • Lessons to Be Learned from Heightened Enforcement Actions Relating to Export Control and Economic Sanction Violations, 2013 Spring Meeting of ABA Section of International Law, Washington, DC, April 26, 2013 (co-moderator of panel)
  • Export Controls and Economic Sanctions, Connecticut Chapter of Association of Corporate Counsel, Hartford, Connecticut, June 16, 2009 (panelist)

Related Teaching

  • Lecturer, The Justice Department’s Enforcement of U.S. Export Control and Sanctions Laws, American University Washington College of Law, Washington, DC, March 22, 2018.
  • Lecturer, Department of Justice Prosecutions of Export Control and Sanctions Violations, Executive Masters in International Trade Compliance, University of Liverpool, London, United Kingdom, January 26, 2017
  • Lecturer, Criminal Enforcement of U.S. Export Control and Sanctions Laws, National Advocacy Center, U.S. Department of Justice (2015-2017)

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