News and Press Releases

New jersey-based defense contractor sentenced for violating arms export control act, conspiracy with chinese company



FOR IMMEDIATE RELEASE
November 15, 2011


 

Swiss Technology Inc. Ordered to Pay $1.1 Million in Restitution

NEWARK, N.J. – New Jersey-based defense contracting company Swiss Technology Inc. (Swiss Tech), was sentenced today to two years of probation for conspiring to violate the Arms Export Control Act by exporting U.S. Department of Defense (DoD) drawings and specifications to the People’s Republic of China, U.S. Attorney Paul J. Fishman announced.

Swiss Tech, once located in Newark and now in Clifton, N.J., was also ordered to pay restitution of $1,148,051.80 to the DoD when it was sentenced before U.S. District Judge Jose L. Linares in Newark federal court. The company previously pleaded guilty through its managing member to an Information charging one count of conspiracy to commit an export control violation.

According to documents filed in this case and statements made in court:

From August 2004 through June 2009, Swiss Tech entered into contracts with the DoD to manufacture defense articles and parts for use in military operations. Rather than manufacture the parts, Swiss Tech exported DoD drawings, specifications, and sample parts to the People’s Republic of China without obtaining a license from the U.S. State Department.

The company contracted with a company in the People’s Republic of China, which manufactured the items at a much cheaper price per unit than they would have cost to make in the United States using domestic product. The items included parts to be used with M4 and M16 rifles and M249 machine guns, some of which were to be used in United States military operations.

Swiss Tech admitted that it entered into the agreement with the company in the People’s Republic of China for the financial benefit of Swiss Tech and its co-conspirators and to hide its activities from the United States government. As a result of the conspiracy, Swiss Tech caused the DoD to sustain losses of more than $1.1 million in connection with the fraudulent contracts.

U.S. Attorney Fishman credited special agents of DCIS, under the direction of Special Agent in Charge Edward T. Bradley; and ICE HSI, under the direction of Acting Special Agent-in-Charge Andrew M. McLees, for the investigation leading to the guilty plea. He also thanked attorneys from the U.S. Department of Justice’s National Security Division, Counterespionage Section, under the direction of Assistant Attorney General Lisa O. Monaco, for their assistance; as well as DoD’s Air Force Office of Special Investigations, under the direction of Brig. Gen. Kevin Jacobsen, commander of OSI; and Army Criminal Investigation Division, under the direction of Special Agent in Charge Forrest Woodward.

The government is represented by Assistant U.S. Attorney Zahid N. Quraishi of the U.S. Attorney’s Office in Newark.

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Defense counsel: Michael S. Weinstein Esq., Hackensack, N.J.

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