From May through August of this year, the Baltimore Special Agent-in-Charge (SAIC) office ran an undercover operation to apprehend two individuals who intended to sell to China one of the most sensitive items on the munitions list. One person is a naturalized American citizen born in China; the other, a permanent resident alien also born in China.

The technology in question is the KIV/7HS encryption unit. To most of us, that sounds like something from Star Wars, and functionally, it may be. It's used to secure and safeguard classified communications; in other words, it protects our secret codes. It's one of the most sensitive - that is, highly classified - items on the munitions list, so tightly controlled that the National Security Agency must approve its sale to anyone or any country beyond our borders.

Anyone who wants to export it must be registered with the State Department'sOffice of Defense Trade Controls (Canada is the lone exception). The exporter must also get an export license which covers that specific item and that identifies the intended final destination - i.e., the country or person - before any KIV-7HS units are exported. Needless to say, the supposed exporters had no intention of registering with the Office of Defense Trade Controls or of obtaining the license. And they wouldn't have been able to do either one, legally, had they tried. As said earlier, this item is tightly controlled.

When one of the men contacted the unit's manufacturer in Columbia, Md., to inquire about its cost, an alert employee contacted Customs.

Customs agents instructed the company to tell him that all future business related to exporting the KIV-7HS units would be handled through an intermediate import/export professional. That professional, of course, was an undercover special agent.

Wire taps and correspondence revealed that the units were bound for a Singapore-based firm that would transship them through Taipei and deliver them to China.

At first, when the "intermediary" told the exporter that he would need an export license, the latter seemed interested in trying to get one and asked the Customs-agent-intermediary if he could do so. But the agent told him that no license would be approved for China and that exporting to China is expressly prohibited by the Arms Control Export Act.

Undeterred, the exporter gave all indications that he was going ahead with the sale. Customs made its move. The two co-conspirators were arrested and later indicted in Maryland for an attempt to violate the Arms Export Control Act.

"Customs strategic investigations program has never been more important in light of the terrorist threat we now face," says Baltimore SAIC Allan Doody. "In this case, we were extremely successful in preventing loss of critical communications technology to a foreign power."

Project Shield America
As one of Customs major enforcement initiatives, Project Shield America seeks to stop the illegal movement of U.S. munitions-list items and strategic technology to proscribed destinations when the items or technology might have sensitive civil or military applications. "Proscribed destinations" includes terrorist organizations that pose a threat to our or our allies' national security.

"Illegal movement" includes the importation or exportation of strategic items and technology.

Customs will implement Project Shield America on three fronts: inspection/interdiction, investigations, and international cooperation. Thus, specially trained Customs inspectors will be stationed at high-threat ports to selectively inspect suspicious exports.

The investigation's effort will deploy special agents in proactive roles to initiate cases that lead to the arrest, seizure, and prosecution of the offenders of the Export Administration Act, the Arms Export Control Act, and other relevant statutes.

On the international front, Customs attachés in foreign countries will enlist the support of their host governments to develop information for new or ongoing investigations.

American business can help protect both its own technological accomplishments as well as national security by providing information to Project Shield America on any suspicious circumstances that surround exports of high technology or related services.

The Project Shield America command center will be located in Washington, D.C., and will be in constant contact with the Departments of Commerce, State, Defense, and any other agencies concerned with the export of strategic materials, technologies, or services.