COMMERCE HITS MCDONNELL DOUGLAS WITH $2.12-MILLION PENALTY
The U.S. Commerce Department has imposed a $2.12 million civil penalty against McDonnell Douglas to settle charges that the company illegally shipped machine tools to China.
“This settlement concludes a six-year investigation with the second-largest civil fine ever imposed by the Commerce Department in an export control case,” said Kenneth I. Juster, undersecretary of Commerce’s Bureau of Export Administration.
The federal investigation involves exports that the aircraft manufacturer made to China in 1994 and 1995. McDonnell Douglas allegedly submitted license applications containing false and misleading statements about the end-use and end-user of the machine tools. Commerce also alleged that the exports violated the conditions of U.S. export licenses issued to the company.
In May, Commerce concluded another case which resulted in a $1.32 million civil penalty and a denial of export privileges on a group of Chinese government-owned companies and their U.S. affiliates that received the machine tools from McDonnell Douglas.
“This case demonstrates that the Commerce Department will hold exporters strictly accountable for misrepresentations made in securing export licenses and for abiding by the terms and conditions of licenses once issued,” said Michael J. Garcia, Commerce’s assistant secretary for export enforcement.
The Boeing Co., the parent of McDonnell Douglas, will assume responsibility and liability for all exports under the Commerce’s jurisdiction made or to be made by the aircraft manufacturer.