A report today in the Internet edition of Electronics Weekly brought to my attention some correspondence back in June between the Securities and Exchange Commission (“SEC”) and Intel. The correspondence arose from newspaper reports in May that Cuba had lifted its ban on sales of PCs to individuals and that, as a result, a PC with an Intel Celeron processor could now be (at least theoretically) purchased by ordinary Cuban citizens for just under $800.

That got some of the SEC staff scratching their heads over how on earth an Intel chip wound up in Cuba. Apparently they don’t teach a class on re-exports in SEC bureaucrat training school. So, the SEC fired off a letter asking Intel why it hadn’t disclosed its nefarious dealings with Cuba in any of its SEC filings.

Intel’s response is a model of understated wit in response to an asinine agency inquiry. The shorter form of the reply goes something like this: “We didn’t disclose our dealings in Cuba because we don’t have any such dealings as they would be illegal. D’oh!” More specifically the reply to the SEC stated:

Intel prohibits all transactions with countries identified under certain trade related sanctions. … Consequently, the company prohibits all business transactions with the Subject Countries, which are included in the list of embargoed countries under the Export Regulations, through its export compliance program and takes appropriate action to enforce this policy through customer contracts, policy reminder communications, training of employees and customers, and investigation of potential policy violations. …

On occasion, Intel has followed up with customers regarding possible shipments of Intel products to the Subject Countries in violation of Intel’s policy, but there have not been any instances of Intel direct shipments or customer shipments with the express or implied agreement of Intel, to such countries.

Having gotten that out of the way, Intel schools the SEC on how Celeron processors might have found their way into Cuba. The press reports on the Cuban computers indicated that they were assembled in Cuba using parts imported from China. Intel then wryly notes:

We do not know if an Intel customer in China, or a party who purchased processors from an Intel customer in China, shipped the parts to Cuba, nor if the article is accurate with regard to the reference to China. Each year we sell millions of microprocessors to approximately 13,000 customers in China.

But Intel saves its best zinger for last:

[D]ue to the travel and other constraints imposed by the embargo, it was not feasible for Intel to investigate this matter in Cuba.

Hehe.

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