The Disruptive Technology Strike Force hosted a summit on Feb. 7-8, 2024, in Phoenix, Arizona, to commemorate its one-year anniversary. The Strike Force is an interagency law enforcement effort aimed at preventing authoritarian regimes and hostile nation-states from acquiring critical technologies.
The Strike Force, which seeks to identify and prosecute criminal violations of export control laws and enhance administrative enforcement actions, previously named China, Iran, Russia and North Korea as examples of adversaries that may put these critical technologies to use in ways that threaten U.S. security or lead to oppression of domestic populations.
The summit began with a law enforcement-only day focused on investigative best practices and one-year reports from all 15 of the local cells. On the second day of the summit, the Strike Force was joined by members of the private sector and academia to discuss corporate compliance, best practices for building trade compliance programs and law enforcement outreach efforts.
During the summit, the Strike Force announced an expansion to three new metropolitan areas and formally recognized the Defense Department’s Defense Criminal Investigative Service as a partner in the Strike Force. Assistant Secretary for Export Enforcement Matthew Axelrod of the Commerce Department’s Bureau of Industry and Security (BIS) noted that, in the Strike Force’s second year, industry can “anticipate seeing some bigger ticket corporate resolutions in 2024.” He explained that “the bigger corporate cases have sort of an additional benefit. When we bring them, it’s not only that we hold people accountable for violating our rules, but also I think it sends a really strong message about the importance of investing in compliance on the front end.”
The Strike Force also announced two prosecutions alleging sophisticated schemes to transfer sensitive technology, goods and information for the benefit of hostile foreign adversaries.
In the Eastern District of New York, two Iranian nationals were charged with conspiring to export equipment used in the aerospace industry to Iran without the required licenses, in violation of the International Emergency Economic Powers Act. As alleged in the indictment, the defendants acted on behalf of the government of Iran as they worked to disguise the final destination of U.S. components that Iran’s aerospace industry could use. The defendants allegedly attempted to forward these components through intermediaries in Europe and elsewhere.
In the Central District of California, a U.S. citizen of Chinese descent was arrested for allegedly stealing trade secrets developed for use by the U.S. government to detect nuclear missile launches and track ballistic and hypersonic missiles. The files the defendant allegedly transferred included blueprints for sophisticated infrared sensors designed for use in space-based systems to detect nuclear missile launches and track ballistic and hypersonic missiles, and blueprints for sensors designed to enable U.S. military aircraft to detect incoming heat-seeking missiles and take countermeasures. According to the complaint, from 2014 to 2022, the defendant submitted numerous applications to the Chinese government’s talent program while employed at several major technology companies in the United States.
As these federal prosecutions demonstrate, the Strike Force continues to focus on cases involving theft of trade secrets and export control enforcement. Exporters and developers of advanced technologies —such as supercomputing and exascale computing, artificial intelligence, advanced manufacturing equipment and materials, quantum computing and biosciences — should be particularly vigilant with export compliance protocols and monitoring employee actions in this heightened enforcement and global threat environment. Investigations launched by the Strike Force likely will require increased cooperation with law enforcement agencies. Additionally, Axelrod’s remarks, including his comments regarding the beneficial message sent as a result of “bigger corporate cases,” underscore the need for robust internal procedures for protecting trade secrets and for compliance with export controls, especially given BIS and the Justice Department’s recent focus on voluntary disclosures.
Please contact the authors if you have any questions regarding trade secret theft or export control compliance protocols.