Machine Gun Specifications and Components to China

On July 12, 2011, Swiss Technology (Swiss Tech), Inc., a company in Clifton, N.J. that makes equipment for the U.S. military, pleaded guilty in the District of New Jersey to a one count criminal information charging the firm with conspiracy to violate the Arms Export Control Act from August 2004 to about July 2009. On November 15, 2011, Swiss Tech was sentenced to two years probation and ordered to pay restitution in the amount of $1.1 million to the Defense Department in connection with fraudulent contracts. Swiss Tech was under contract with the Department of Defense to manufacture components for the M249 machine gun. In order to lower its manufacturing costs, Swiss Tech sent defense articles, including specification drawings and parts samples, to a company in the People’s Republic of China so that the Chinese company could make these machine gun components for Swiss Tech. Swiss Tech did not have the required State Department license for exports of these munitions to China. After receiving the components from the Chinese company, Swiss Tech then shipped the defense articles and other parts to the Department of Defense, purporting that the defense articles were made by Swiss Tech in conformance with its contract. Among other things, Swiss Tech illegally exported to China specifications for the production of M249 machine gun parts, as well as components for the M249 machine gun, and M16 or M4 rifle. This investigation was conducted by DCIS and ICE.