If the potential benefits of a voluntary disclosure of export violations to the Directorate of Defense Trade Controls (“DDTC”) are not a sufficient motivation, exporters should remember that today’s happy employee can be tomorrow’s disgruntled former employee. The disgruntled former employee is then happy in only one respect: all too happy to blow the whistle on the exporter’s alleged violations of export laws.

Consider the case of a Tennessee-based company that provides security and related services to the United States Government in Iraq and elsewhere. A year ago the company fired an employee for allegedly falsifying time records and for an “appearance of impropriety.” The employee filed suit for wrongful termination, and his complaint cited acts of impropriety allegedly committed by other company employees without termination or other consequences.

The improprieties included the following alleged ITAR violations:

• The company allegedly asked employees to carry Gen III night vision in their checked baggage to avoid licensing requirement.
• The company allegedly shipped shotguns to Iraq without required licenses.
• The company allegedly made multiple shipments of ammunition under the 1000-cartridge exemption in ITAR § 123.17(c) in order to avoid licensing requirements.
• The company allegedly sent U.S. employees to Uganda and Nigeria to train troops without DDTC authorization

The company denies these allegations, providing the following statement to the Knoxville News when asked to comment on the litigation:

[The company] acknowledges the lawsuit filed by […], a former employee. Because of the ongoing legal process, [the company] cannot comment on the details of the proceedings, except to point out that claims similar to those raised in Loudon County were previously raised by [the employee] and others in lawsuits filed in Knox County and Blount County and both of those lawsuits have been dismissed. [The company] also registers its disappointment in the use of sensational, unsubstantiated, and untrue allegations as a tactic to obscure the real issues of the case.

Of course there’s no way to determine who is telling the truth here but, even so, exporters should never think that there’s no way anyone could ever find out about their potential export violations.