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U.S. Companies Allegedly Violated Sanctions and Sold Missile Parts to Iran

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Federal authorities raided a business in Houston on April 17 as part of an international investigation, resulting in two arrests. According to officials, a total of nine individuals have been indicted for allegedly shipping state-of-the-art microelectronics that can be used to to build surface-to-air and cruise missiles.

“The nine defendants charged in the indictment allegedly circumvented U.S. sanctions and illegally exported controlled microelectronics to Iran,” said Assistant Attorney General for National Security John P. Carlin in a press release. “Violations of the International Emergency Economic Powers Act not only can undercut the impact of U.S sanctions, but can also serve to undermine U.S. foreign policy and adversely affect national security. I want to thank all those in law enforcement whose tireless efforts led to these charges.”

U.S. exports have always been a vital part of the domestic economy. Back in 2011, U.S. goods and services exports supported about 9.7 million jobs. According to a report from the International Trade Administration, exports of goods and services directly and indirectly supported an estimated 11.7 million U.S. jobs in 2014. As it’s such a vital part of the U.S. economy, the exports industry is taken seriously, and any attempts to circumnavigate its regulations are dealt with swiftly.

That, however, is not what makes this situation so serious. The U.S. has sanctions on Iran, which American officials are using to persuade the country to renounce its ambitions to develop nuclear weapons. The 24-count indictment alleges that 69-year-old Bahram Mechanic and 46-year-old Tooraj Faridi of Houston-based Smart Powers Systems were members of an Iranian procurement network.

According to the indictment, Mechanic and others engaged in a conspiracy to obtain and distribute $24 million worth of various commodities from July 2010. While carefully dodging government licensing systems, they allegedly exported microcontrollers and digital signal processors, which officials said are used in a wide range of military systems, including surface-to-air and cruise missiles.

If convicted, the corporations involved in the conspiracy face up to $1 million in fines for each of the U.S. sanctions violated, and the defendants face up to 20 years in prison.

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