04-4003. Bureau of Political-Military Affairs; Administrative Debarments Involving Kam-Tech Systems, Ltd. and David Menashe

AGENCY:

Department of State.

ACTION:

Notice.

SUMMARY:

Notice is hereby given that the Department of State has imposed administrative debarment pursuant to section 127.7(a) and (b)(2) of the International Traffic in Arms Regulations (“ITAR”) (22 CFR parts 120 to 130) on persons convicted of a violation of such as to provide a reasonable basis for the Directorate of Defense Trade Controls to believe that the violators cannot be relied upon to comply with the Arms Export Control Act (“AECA”) (22 U.S.C. 2778) or the ITAR in the future and which violation was established in accordance with part 128 of the ITAR.

EFFECTIVE DATE:

Date of Order as specified for each person.

FOR FURTHER INFORMATION CONTACT:

David Trimble, Director, Directorate of Defense Trade Controls Compliance, Bureau of Political-Military Affairs, Department of State [phone].

SUPPLEMENTARY INFORMATION:

Section 127.7 of the ITAR authorizes the Assistant Secretary of State for Political-Military Affairs to issue an Order for Administrative Debarment against any person who has been found pursuant to Part 128 of the ITAR to have committed a violation of the AECA or the ITAR of such character as to provide a reasonable basis for the Office of Defense Trade Controls Compliance to believe that the violator cannot be relied upon to comply with the AECA or ITAR in the future. Such an Order of Debarment prohibits the subject from participating directly or indirectly in the export of defense articles or defense services for which a license or approval is required by the ITAR.

The period for debarment will normally be three years from the date of Order. At the end of the debarment period, licensing privileges may be reinstated only at the request of the debarred person following the necessary Departmental review. Unless licensing privileges are reinstated, the person/entity will remain debarred.

Debarred persons are generally ineligible to participate in activity regulated under the ITAR (See e.g., sections 120.1(c) and (d), 126.7, 127.1(c), and 127.11(a)). The Department of State will not consider applications for licenses or requests for approvals that involve any debarred person.

Pursuant to section 38 of the AECA and section 127.7(a) and (b)(2) of the ITAR, the following persons have been administratively debarred by the Assistant Secretary of State for Political-Military Affairs for a period of three years effective the date the Order is signed by Assistant Secretary of State for Political-Military Affairs:

(1) Kam-Tech Systems, Ltd. (“Kam-Tech”), an Israeli company located in Tel Aviv, Israel, and

(2) David Menashe (“Menashe”), owner and business manager of Kam-Tech.

Kam-Tech and Menashe pleaded guilty and, on June 18, 2003, were convicted of making false statements to the Bureau of Customs and Border Protection, U.S. Department of Homeland Security (formerly United States Customs Service (USCS)) in violation of 18 U.S.C. 1001. (U.S. District Court, Central District of California (Western Division), Docket # 03-CR-139-ALL.) Under the plea agreements entered in connection with the prosecution, Kam-Tech and Menashe agreed to a statement of facts that they caused a package to be shipped to the United States bearing an air waybill that falsely stated the contents consisted of “samples for evaluation” and were valued at $245, when the defendants knew the package contained an AIM-9 Missile Seeker Section valued at $19,600 and that this defense article was to be transshipped to China. They further agreed to administrative debarment under section 127.7(a) and (b)(2) of the ITAR on the basis of the aforementioned statement of facts and to waive all rights under Part 128 of the ITAR, including the provision for issuance of a charging letter and all rights to seek administrative or judicial consideration or review or otherwise to contest the validity of the Order of Debarment. The Directorate of Defense Trade Controls believes that the actions of Kam-Tech and Menashe support a finding of a violation of section 127 of the ITAR of such character that neither could be relied upon to comply with the ITAR in the future. Furthermore, as set forth above, such violation was established in accordance with part 128 of the ITAR.

As noted above, at the end of the three-year period, the above named persons will remain debarred unless licensing privileges are reinstated.

This notice is provided in order to make the public aware that the persons listed above are prohibited from participating directly or indirectly in any brokering activities and in any export from or temporary import into the United States of defense articles, related technical data, or defense services in all situations covered by the ITAR. Specific case information may be obtained from the Office of the Clerk for each respective U.S. District Court citing the court docket number where provided.

Exceptions may be made to this denial policy on a case-by-case basis at the discretion of the Directorate of Defense Trade Controls. However, such an exception would be granted only after a full review of all circumstances, paying particular attention to the following factors: Whether an exception is warranted by overriding U.S. foreign policy or national security interest; whether an exception would further law enforcement concerns that are consistent with the foreign policy or national security interests of the United States; or whether other compelling circumstances exist that are consistent with the foreign policy or national security interests of the United States, and do not conflict with law enforcement concerns.

This notice involves a foreign affairs function of the United States encompassed within the meaning of the military and foreign affairs exclusion of the Administrative Procedure Act. Because the exercise of this foreign affairs function is discretionary, it is excluded from review under the Administrative Procedure Act.

Dated: February 1, 2004.

Lincoln P. Bloomfield, Jr.,

Assistant Secretary, Bureau of Political-Military Affairs, Department of State.