Thursday, March 15, 2007

Export Caution

Red Flag Indicators
Bureau of Industry and Security

Things to Look for in Export Transactions
Use this as a check list to discover possible violations of the Export Administration Regulations. You may also wish to visit our page that provides "Know Your Customer Guidance".

• The customer or its address is similar to one of the parties found on the Commerce Department's [BIS's] list of denied persons. Case example.
• The customer or purchasing agent is reluctant to offer information about the end-use of the item.
• The product's capabilities do not fit the buyer's line of business, such as an order for sophisticated computers for a small bakery.
• The item ordered is incompatible with the technical level of the country to which it is being shipped, such as semiconductor manufacturing equipment being shipped to a country that has no electronics industry.
• The customer is willing to pay cash for a very expensive item when the terms of sale would normally call for financing.
• The customer has little or no business background.
• The customer is unfamiliar with the product's performance characteristics but still wants the product.
• Routine installation, training, or maintenance services are declined by the customer.
• Delivery dates are vague, or deliveries are planned for out of the way destinations.
• A freight forwarding firm is listed as the product's final destination.
• The shipping route is abnormal for the product and destination.
• Packaging is inconsistent with the stated method of shipment or destination.
• When questioned, the buyer is evasive and especially unclear about whether the purchased product is for domestic use, for export, or for reexport.

If you have reason to believe a violation is taking place or has occurred, you may report it to the Department of Commerce by calling its 24 hour hot line number: 1 (800) 424-2980. Or if you prefer use our form to submit a confidential tip.

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