Itt night vision technology
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ITT-- Night Vision Technology. Kam Ng and Scott Nelson 25 November 2008. Night Vision Goggle Technology. Night vision technology helps people to see better in the dark and hence maneuver and fight effectively at night.

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ITT-- Night Vision Technology

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Itt night vision technology

ITT-- Night Vision Technology

Kam Ng and Scott Nelson

25 November 2008


Night vision goggle technology

Night Vision Goggle Technology

  • Night vision technology helps people to see better in the dark and hence maneuver and fight effectively at night.

  • On 27 March 2007, ITT Corporation pleaded guilty on arms export violation to People’s Republic of China, United Kingdom, and Singapore, and fined $100M.1

Reference 1: Statement of U.S. Attorney, DOJ, 27 March 2007


Legislation development summary

Legislation—Development & Summary

  • Trade Issues: Export Control & National Security

    • Production Act of 1950 was amended, and replaced by Foreign Investment and National Security Act (FINSA) of 2007 on 4 January 2007

    • New provisions of FINSA include: security improvement amendments, review & investigation process, monitoring & enforcement, action by the President, increased oversight by Congress, certification process, and regulations2

Reference 2: H.R. 556, Foreign Investment and National Security Act of 2007


Finsa 2007

FINSA (2007)

  • Some of the key changes from the Defense Production Act of 1950 include:

    • National Security is now defined as to include issues related to Homeland Security

    • Critical technologies is defined as items essential to national defense


Key provisions of finsa national security

Key Provisions of FINSA: National Security

  • Investigations will be conducted immediately if:

    • Transaction threatens U.S. National Security and the threat has not been mitigated

    • The transaction is a foreign government transaction


Legislation related regulations

Legislation- Related Regulations

  • Ensure national security while promoting foreign investment and open trade

  • Export control and enforcement

  • Arms Export Control Act (AECA) of 1976, 22 U.S.C 2778--President is authorized to control import and export of defense articles and services

  • International Traffic in Arms Regulation (ITAR) of 1999, CFR Title 26--Department of State regulates defense technologies via U.S. Munitions List3

  • Export Administration Regulations (EAR)--Department of Commerce, Bureau of Industry & Security regulates export “dual-use” items4 via license


Itt night vision technology

ITAR--U.S. Munitions List 22 CFR 121

Firearms, Close Assault Weapons/Combat Shotguns

Guns and Armament

Ammunition/Ordnance

Launch Vehicles, Guided Missiles, Ballistic Missiles, Rockets, Torpedoes, Bombs and Mines

Explosives, Propellants, Incendiary Agents & Their Constituents

Vessels of War and Special Naval Equipment

Tanks and Military Vehicles

Aircraft and Associated Equipment

Military Training Equipment and Training

Protective Personnel Equipment and Shelters

Military Electronics

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Itt night vision technology

ITAR—U.S. Munitions List 22 CFR 121

  • Fire Control, Range Finder, Optical and Guidance and Control Equipment

  • Auxiliary Military Equipment

  • Toxicological Agents including Chemical Agents, Biological Agents, and Equipment

  • Space Systems and Associated Equipment

  • Nuclear Weapons, Design and Testing Related Items

  • Classified Articles, Technical Data and Defense Service not Otherwise Enumerated

  • Directed Energy Weapons

  • Reserved

  • Submersible Vessels, Oceanographic and Associated Equipment

  • Miscellaneous Articles

Reference 3: http://pmddtc.state.gov/regulations_laws/itar.html

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Itt night vision technology

EAR—Commodities Control List

0. Nuclear Materials, Facilities & Equipment and Miscellaneous

1. Materials, Chemicals, Microorganisms & Toxins

2. Materials Processing

3. Electronics Development

4. Computer (Development and Programs)

5. Telecommunications and Information Security

6. Sensors and Lasers

7. Navigation and Avionics

8. Marine

9. Propulsion Systems, Space Vehicles and Related Equipment

Dual-Use Items

and Technology

Reference 4: http://www.access.gpo.gov/bis/ear/ear_data.html

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Itt night vision case

ITT Night Vision Case

  • ITT Corp Night Vision Division violated arms export regulation. Specifically, ITT illegally sent classified and export controlled information to foreign countries--People’s Republic China (PRC).

  • ITT disclosed classified technical information on night vision counter measure known as “light interference filter” to prohibited countries & facilities.4

  • Other countries involved– United Kingdom, Singapore, and Japan as middle-men.

    Reference 4: Statement of U.S. Attorney, DOJ, 27 March 2007


Itt night vision technology

ITT Night Vision Case

  • Motivation--outsourcing of manufacturing of night vision goggles to PRC to reduce its costs & enhance its profit

  • Violations--Arms Export Control Act (22 U.S.C 2778)5, International Traffic in Arms Regulation (22 CFR 127.7),5 and provided false & misleading information during investigations

  • ITT new CEO, Mr. Loranger ordered internal investigation and fully cooperated with government investigations

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Reference 5: ITT Corporation, Federal Register, 11 April 2007


Itt night vision case1

ITT Night Vision Case

  • March 2001 and August 2001

    • ITT export defense-related technology to countries without a license or written authorization from the U.S. Department of State

    • Night vision goggles are on the U.S. Munitions List; require a license or authorization before export6

Reference 6: Consulate General of the United States, March 27, 2007


Itt night case

ITT Night Case

  • April 2000 and October 2004

    • ITT excluded facts from the Arms Exports Required Reports

    • Reports were misleading

    • Was company aware of missing information? Yes.6

Reference 6: Consulate General of the United States, March 27, 2007


Parties involved

Parties Involved

  • Department of Justice

    • Filed charges against ITT Corporation

    • DOJ filed charges due to Export Violations of night vision data

    • The position of the DOJ in filing these charges: “The sensitive night vision technology…is sought by our enemies and our allies alike.”

    • The technology must be protected

Reference 6: Consulate General of the United States, March 27, 2007


Parties involved1

Parties Involved

  • US Immigration and Customs Enforcement (ICE) and Defense Criminal Investigative Services (DCIS)

    • Were the investigators in the case against the ITT Corporation

    • The ICE position in the case: “These violations among the most serious of crimes.”

    • The DCIS position: “American security and its critical military technology are not for sale.”

Reference 6: Consulate General of the United States, March 27, 2007


Itt case settlement

ITT Case Settlement

  • ITT paid $100M in fines & penalties ($20M to Department of State, $2M as statutory fine, $28M to law enforcement agencies, $50M for R&D as restitution to American soldiers)

  • ITT pays for an independent monitor and staff in compliance with the agreement & federal law


Foreign trade policy issues

Foreign Trade Policy Issues

  • National security (export control) versus open trade & economic/technology development

  • Regulation & enforcement involved several agencies, Department of State, Department of Commerce, Department of Defense, and Department of Homeland Security

  • Determination of military critical technologies


The critical foreign trade issue

The Critical Foreign Trade Issue

  • Exportation of sensitive technology without a license or written authorization by the U.S. Department of State

    • “jeopardizes our national security and the safety of our military men and women on the battlefield.” – Asst. Attorney General Kenneth Weinstein, DOJ.

    • Illegal exporting of sensitive technology and data “threatens our national security in the most direct way.” – Daniel F. Wilkins, Acting Director of the NCIS

Reference 6: Consulate General of the United States, March 27, 2007


Critical issues the consequences

Critical Issues: The Consequences

  • Compromise and disclosure of U.S. military critical technologies to adversaries

  • Information and technology could help terrorists to launch an attack and/or counter attack

Bottom Line: U.S. might lose it’s military superiority & capabilities


Policy proposal

Policy Proposal

  • The regulations on arms export must be strongly enforced

  • The military critical technologies should be tightly safeguarded

  • The National Security Policy would negatively impact the global free trade and technology transfer


Policy proposal1

Policy Proposal

  • The regulations on arms export must be strongly enforced

    • If companies such as ITT are allowed to violate U.S. trade policy and FINSA, our technology could enter the wrong hands

    • Example: U.S. equipment found in photos of an Iranian nuclear facility


Policy proposal2

Policy Proposal

  • The military critical technologies should be tightly safeguarded

    • Violations of FINSA and U.S. Trade policy can put our own citizens in danger at home and abroad

    • This can make the government take protectionist measures with both foes and allies

    • It could harm trade relations and cause tariffs and other sanctions to take place

    • These sanctions could cause increases in cost for creation and innovation of critical technologies


Policy proposal3

Policy Proposal

  • Ultimately, the National Security Policy would negatively impact the global trade and technology transfer

    • The protectionist measures could spill into international economics in other sectors

    • International relations with allies could become strained due to lack of trust for security purposes


Pro and con of policy proposal

Pro and Con of Policy Proposal

  • National security versus free trade & economic/technology development

  • Adam Smith: “defense is more important than opulence.”7

  • Willett & Jalalighajar: “trade restrictions implemented in the name of national security is the result of protectionist pressures and unwise foreign policy strategies.”8

Reference 7: Adam Smith, The Wealth of Nations, 1937, p.431

Reference 8: Tomas Willett and Mehrdad Jalalighajar, “U.S. Trade policy and National Security,”

CATO Journal, 1983, p. 717-727


References

References

1. Statement of U.S. Attorney John Brownlee on the Guilty Plea of ITT Corporation

for Illegally Transferring Classified and Export Controlled Night Vision Technology to Foreign Countries, U.S. Department of Justice, 27 March 2007

2. Foreign Investment and National Security Act of 2007, H.R. 556, 4 January 2007

3. http://pmddtc.state.gov/regulations_laws/itar.html

4. http://www.access.gpo.gov/bis/ear/ear_data.html

5. Statutory Debarment of ITT Corporation Pursuant to the Arms Export Control Act and the International Traffic in Arms Regulations, Federal Register, 11 April

2007

6. Consulate General of the United States – Hong Kong and Macau http://hongkong.usconsulate.gov/uscn_others_2007032701.html

7. Adam Smith, The Wealth of Nations, 1937

8. Tomas Willett and Mehrdad Jalalighajar, “U.S. Trade Policy and National Security,” CATO Journal, 1983, p. 717-727

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