Computerlinks FZCO given hefty fine for breaking export rules
Blue Coat kit was illegally sold to the Syrian government and used for Internet surveillance, but the blame has fallen on a channel partner that has been made to pay a sizeable fine to US authorities.
The US Department of Commerce hit Computerlinks FZCO, a Dubai distribution company, with a $2.8 million (£1.8m) penalty, a statutory maximum. after it sold Blue Coat ProxySG appliances to Syria.
It was alleged the company had on three occasions in 2010 and 2011 “engaged in transactions or took actions with the intent to evade the Export Administration Regulations in connection with the unlawful export and re-export to Syria,” the US Department of Commerce said.
“Today’s settlement reflects the serious consequences that result when companies evade US export controls. It is the result of an aggressive investigation and prosecution by [the Bureau of Industry and Security] of the unlawful diversion of US technology to Syria,” said under secretary for industry and security Eric Hirschhorn.
“It is vital that we keep technology that can repress the Syrian people out of the hands of the Syrian government.”
It is believed Blue Coat had no knowledge of the transaction, and terminated its contract with Computerlinks in 2011 over the investigation. The company, which makes money primarily through its channel partners, commended the decision to issue a fine.
“We take care to ensure that our products are sold in accordance with laws that prohibit the sale of our technology for certain end uses and to certain destinations and end users,” said David Murphy, COO and president of Blue Coat Systems.
“We have cooperated extensively with the U.S. government and will continue to support its ongoing investigation into the unlawful diversion of our products as required.
“Throughout 2013, we will continue to review our business, policies and procedures and engage with key stakeholders, including our channel partners, to determine what steps we can take to further limit the unlawful diversion and misuse of our products.”
The news came just months after research showed Blue Coat technologies are being widely used in nations with poor human rights records, including China, Egypt, Saudi Arabia, the UAE, Iraq, Russia, Afghanistan, Bahrain and India.
There was no evidence the technologies were being misused, however, nor whether export laws had been breached.
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