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BIS slaps export violator with huge fine

Florida-based forwarder settles with $27 million penalty after willfully committing EAR violations

By: Chris Gillis
 | 
Photo: SumanBhaumik / Shutterstock
   Sarasota, Fla.-based Access USA Shipping has agreed to settle Commerce Department allegations to the tune of $27 million over numerous violations of the country’s Export Administration Regulations (EAR).
   Specifically, Access USA settled 129 counts of evasion, 17 counts of exporting or attempting to export “crime control” items without the required Commerce licenses, and four counts of exporting or attempting to export to a sanctioned entity on the Bureau of Industry and Security’s (BIS) Entity List without the proper license. According to BIS, the company facilitated the exports of rifle scopes, night vision lenses, weapons parts and other EAR 99 items.
   Access USA, a mail and package freight forwarder, operates as a so-called fourth party logistics service by providing overseas customers with a U.S. physical mailing address and a “suite” – or designated space at its warehouses—for items purchased from U.S. merchants that were ultimately intended for export.
   In other instances, the company offered a “personal shopper” or “alternative” program, whereby an Access USA employee presented himself or herself to the U.S. merchant as the purchaser of the products. The charging documents noted that at times shipments were even delivered to these Access USA employees’ homes “to ensure that the U.S. merchant would be misled to believe that Access was not involved in the [export] transaction.”
   BIS explained in a March 14 press release that “item descriptions were altered and merchant invoices removed in order to avoid detection by the U.S. government and law enforcement...Access USA routinely undervalued, misrepresented, and evaded regulatory requirements for items intended for export using multiple different schemes.”
   Robert Luzzi, special agent in charge of Commerce’s Office of Export Enforcement in Miami, said “BIS imposed a substantial penalty in this case after Access USA’s efforts to circumvent U.S. export regulations,” although the agency noted that $17 million of the $27 million penalty had been suspended for a two-year probationary period for the company.
   Access USA was founded in 1997 and also conducted business as MyUS.com. The company’s lead executive at the time covered by the BIS investigation included Eric Baird, founder, chief executive officer and president (though Ramesh Bulusu is listed as “president of Access USA Shipping LLC” on the Commerce Department’s charging documents).
   The company’s website promotes the fact that “MyUS processes export paperwork for you, and our compliance expertise allows us to safely ship a variety of U.S. products to you that most others can’t.”
   The export violations first began in April 2011. BIS investigators highlighted 150 violations through Feb. 15, 2013. These illicit shipments were destined to end-users in South Africa, Saudi Arabia, Japan, Kazakhstan, Malaysia, the United Kingdom, Italy, Germany, France, Sweden, Finland, Austria, Switzerland, Hong Kong, Maldives, Zambia, Indonesia, Nigeria, Turkey, Georgia, Turks and Caicos, Guadeloupe, Cypress, United Arab Emirates, Philippines, Thailand, Argentina, Yemen, Taiwan, and Libya.
   As far back as 2009 and 2010, Access USA was even warned by another private package carrier to properly describe and value items in its Automated Export System filings. A BIS special agent issued the same guidance to the company in January 2012. In September 2012, Access USA’s then chief technology officer (not named in the charging documents) warned Baird against “willingly and intentionally breaking the law.”
   Despite these warnings, “Access resumed undervaluing exports and its related export violations of the regulations...knowing that the conduct was unlawful and risked imposition of significant penalties,” BIS said in charging documents.
   On Jan. 24, 2013, Access USA’s Sarasota warehouse was raided by federal and state law enforcement, which led to the start of BIS’s investigation of the company.