The Commerce Department's Bureau of Export Administration (BXA) has imposed a $95,000 civil penalty on Neopoint, Inc., of San Diego, California, to settle allegations that the company exported encryption software to South Korea in violation of U.S. export control laws.
BXA charged that, on ten occasions between March 1998 and June 1999, Neopoint exported 128-bit encryption software to two firms in South Korea without the required export licenses. In all but one of these shipments, BXA alleged that Neopoint knew that an export license was required. Neopoint cooperated fully with BXA's investigation of the charges.
"This case demonstrates that the U.S. Government can and will enforce its export controls on encryption products," said Assistant Secretary of Commerce for Export Enforcement Michael J. Garcia.
BXA administers and enforces export controls on dual-use items and technology for reasons of national security, foreign policy, nonproliferation, anti-terrorism, and short supply. Criminal penalties and administrative sanctions can be imposed for violations of the Export Administration Regulations.
Assistant Secretary Garcia commended Special Agent Lou VanZant, from BXA's Los Angeles Field Office, who investigated this case.