Jan
20
U.S. Extradition Request for Export Defendant Heard by French Court
Posted by Clif Burns at 9:03 pm on January 20, 2010
Category: Criminal Penalties • Iran Sanctions
ABOVE: Majid Kakavand
Amir Ardebili, who we posted on here and here, is not the only Iranian being chased by U.S. prosecutors for activities he committed entirely outside the United States and which were legal in the country where they took place. Majid Kakavand, on whom we previously posted here, used a company of his in Malaysia to order electronic components from U.S. companies and then transshipped those components to Iran. He was provisionally arrested in France in March 2009 at the request of the United States and is currently in France, out of jail but unable to leave France, awaiting the French court’s decision on the U.S. extradition request.
According to this article in the New York Times, a hearing was held last week by a French court on the extradition request. Kakavand’s lawyers argued that Kakavand’s activities did not violate any laws of France or the European Union and that the items were innocuous items that were not useful in the defense industry. Because these items could be legally shipped to Malaysia without an export license and because the U.S. criminal information against Kakavand did not allege that the items in question were on the Commerce Control List or the United States Munitions List, this argument seems to have some force. Another hearing has been scheduled by the French court for February 17.
And as with the Ardebili case, the Iranians were quick to link the fate of Kakavand with an Iranian trial. In this case, the trial in question is a prosecution brought by Iran against a 24-year-old French academic, Clotilde Reiss, in connection with her alleged participation in opposition protests following the Iranian elections last June. Apparently, the concept of a fair trial is so foreign to Iran that it hasn’t occurred to the Iranian government that a French court might actually listen to defense arguments and make a decision based on the rule of law.
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9 Comments:
Interesting blog. I am confused by one point and some of the articles. Some say the conducted was committed entirely outside the United States, but the court paper filed by the gov talks about a number of facts that indicate steps the accused took to reach into the US (lying to US companies about where it was going, and wiring money into the US)? Hard to feel sympathetic. You operate in a lot of countries, you got to play by all the countries’ rules.
@carrie – whether those actions outside the United States but “directed at” the United States are a sufficient basis for prescriptive criminal jurisdiction by the U.S. over a foreign national for activity that was legal where it took place is exactly what the French court will decide.
How do you feel about this hypothetical? I know that my blog is read by, and is directed to, people all over the world. If I say something negative about a foreign regime that would, if I said it in that regime’s country, be against the law of that country, do they have the right to arrest and prosecute me?
After meeting recently with a special agent from a DHS agency, I am even more confused as to how the US finds that it has jurisdiction in these cases. In short, the agent told me that it is the involement of a US person that provides the agency(ies) with jurisdiction over illegal export activities. Unless there are facts tying these guys to US persons, the agent’s interpretation would not allow for these cases. Do you think there is more to the stories that we are not privy to?
I note that once again, OEE is providing the enforcement muscle for OFAC. Have to wonder whether that is because ICE is so busy with other matters or whether this is a permanent unannounced realignment.
One also has to wonder what is in store for the other parties to the transactions, especially the US sellers and the Japanese forwarder, mentioned in the complaint.
At the very least, I suspect there are some brand new compliance procedures being prepared. The forwarder here seems to be the great enabler. There is a long history of foreign freight forwarders, especially from Asia, that seem to be all too willing to serve in this capacity or who, at the very least, do not pay detailed attention to the US export regulations. Perhaps OEE should identify “routed transactions” where the foreign customer selects a foreign freight forwarder as a “Red Flag” requiring further inquiry.
When I was an enforcement type, almost all my cases included, at least as a “supporting” character if not the principal actor, a foreign freight forwarder that didn’t pay much attention to the regs.
Hi Folks-
But if you submitted false information to be filed on government forms for the purposes of getting goods out of that country that you would not have been allowed to receive had you simply told the truth on that form, that seems wrong. Doesn’t it?
I don’t practice international law, but that also seems to me that lying to the government, can get you in hot water in a lot of places. I wouldn’t like to be caught lying to the Chinese government.
As for the directed at point, what if, for example, I sit in Nigeria and email viruses to Franch companies, even though France may have cyber crime laws. France can’t charge me because there may not be a law in Nigeria against this? That seems to render the state pretty powerless to protect its people and companies.
The gov overreaches in a lot of areas (scope of goods controlled for example!), but when these guys come looking for US goods from US companies and lie to US companies to get them and file b/s forms with the gov, I have no problem with the gov charging them. If they don’t want to ship stuff to Iran and “you can get this stuff everywhere”, then they should buy it from the Chinese.
Jennifer:
I don’t think the DHS agent you spoke with gave you the prevailing view of US export enforcement officials.
It is certainly true that the US government may exercise prescriptive jurisdiction over US nationals abroad. This concept of nationality jurisdiction is well-established and uncontroversial, both in US and international law.
But, contrary to what the DHS agent stated, it is not the only sort of jurisdiction that the US government invokes in regulating extraterritorial events. US export authorities claim jurisdiction over the overseas conduct even of foreign nationals based merely on the involvement of US-origin items, or foreign-made items that simply contain a certain percentage of US content. While this item-based jurisdictional approach is disputed as a matter of international law, it has been incorporated into US export controls and is asserted in civil and criminal enforcement cases.
Carrie: The complaint does not allege that Defendant lied to the government. Given that the foreign purchaser could not file the AES, it is highly unlikely that Defendant ever communicated anything directly to the US Government. Foreign purchasers, especially intermediaries such as distributors and brokers, are frequently less than forthcoming about the destination and end-user not for the purpose of evading US export control laws, but for a very good and perfectly respectible commercial purpose: In order to keep the US seller from circumventing the intermediary and selling directly to the the intermediaries buyer or the ultimate end-user so that the US seller can take a biggere profit margin. American firms are ratrher notorious for cutting outr intermediaries. In fact, the reason why Europe and many developing countries have such strong dealer protection laws is precisely because American businesses in the post-WWII era routinely would contract with locals to develop the market, and then cut out the people who had done the work in order to reap a greater profit.
This is the problem with most all of OEE’s “Red Flags”: There are usually legitimate business reasons justifying these business proactices, most of them related to preserving the confidentiality of personal or proprietary business information. The Red Flags and “Know Your Customer Guidance” were written by naive bureaucrats with no actual hands-on experience in international business, especially as it is conducted in developing countries. Don’t get me wrong, most of these kids in power at BIS and OFAC are nice kids with nice educations and very sincere and well intended, but their world-view is based on academic text-book business models which are not informed by the context of the real world. As one of my graduate school professors,the late Enzo Grilli, once quipped: “For the economist, the real world is a special case, and really not all that interesting.” The same is true of the good folks at BIS and OFAC.
All these comments are very interesting. FYI,after the complaint, there has been an indictment. The Kakavand case raises several issues,notwithstanding whether or not the US has jurisdicton in such case.
The problem USA is facing is to obtain extradition from foreign countries. Indeed, the extradition treaty between france and USA (same in most treaties) set forth that extradition must be denied if the crime for which the extradition is requested is not considered as a punishable crime by both the USA and France.
Considering that France (and Europe) does not have general trade embargo against Iran, doing trade with Iran in itself is therefore not a crime in europe but only legal trade practice.
The concerned purchase did not require any export licence from USA to Malaysia.Consequently, there were neither ITAR nor Dual Use on international regulations (wassenaar arrangement). These items could therefore be legally exported from France to Iran.
Violation of the US embargo is not an extraditable crime per se if the same export could have been legally done directly or indirectly from France to Iran.
It should be noted that in Europe or Asia, no one knows that the US applies an absolute embargo on any goods and services of whatever kind. Asia, Europe, south america and africa does not have any such laws against Iran. Therefore, it cannot be expected from foreigners to be informed that purchasing basic items by internet(electrical plug, internet connector, christmas lightening,etc.)for their re-export to Iran (or cuba) may be forbidden.
Regarding the alledge “lies to governement”, when you purchase items on internet, you are not ask who is the end user. You are only request to give a delivery adress. Purchaser fills no form. There can be no lie or fraud in doing so.
The core problem USA will face in trying to have the US embargo applied worldwide and thus for prosecuting foreigners abroad will be to obtain their extradition.
In cases like the one of Kakavand, when the purchased goods are not armament or dual use, extradition request will likely always be denied.
Remains few questions: what is the US interest in pursuing lost cases, at a very high financial cost?
Why spending so much energy and money for such benign
puchases? What’s hidden behind??
In response to Francois Dian; while there is not an embargo from the EU in respect to Iran there are some trade restrictions (can be provided if required) though it has to be said that this is not an embargo. Furthermore if no ones knew about the embargo imposed by the US I think a lot of US companies based in Europe would be in serious trouble.
