[Federal Register Volume 67, Number 33 (Tuesday, February 19, 2002)]
[Notices]
[Pages 7354-7355]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-3854]


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DEPARTMENT OF COMMERCE

Bureau of Export Administration

[Docket No.: 99-BXA-06]


Action Affecting Export Privileges; Preston John Engebretson

    In the Matters of: Thane-Coat, Inc., Jerry Vernon Ford, and 
Preston John Engebretson, Respondents.

Order Relating to Respondent, Preston John Engebretson

    The Bureau of Export Administration, United States Department of 
Commerce (``BXA''), having initiated an administrative proceeding 
against Preston John Engebretson (``Engebretson'') pursuant to section 
13(c) of the Administration Act of 1979, as amended (50 U.S.C. secs. 
2401-2420 (1991 & Supp. V 1999)) (the ``Act''),\1\ and the Export 
Administration Regulations (currently codified at 15 CFR parts 730-774 
(2001)) (the ``Regulations''),\2\ based on allegations that Engebretson 
committed 112 violations of the former Regulations--one violation of 
section 787.3(b), 32 violations of section 787.4, five violations of 
section 787A.4, 32 violations of section 787.5(a), five violations of 
section 787A.5(a), 32 violations of section 787.6, and five violations 
of section 787A.6 of the former Regulations. Specifically the charges 
are:
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    \1\ From August 21, 1994, through November 12, 2000, the Act was 
in lapse. During that period, the President, through Executive Order 
12924, which had been extended by successive Presidential Notices, 
the last of which was August 3, 2000 (3 CFR 2000 Comp. 397 (2001)), 
continued the Regulations in effect under the International 
Emergency Economic Powers Act (50 U.S.C. 1701-1706 (1994 & Supp. V 
1999)) (``IEEPA''). On November 13, 2000, the Act was reauthorized 
by Public Law 106-508 and it remained in effect through August 20, 
2001. Since August 21, 2001, the Act has been in lapse and the 
President, through Executive Order 13222 of August 17, 2001 (66 FR 
44025 (August 22, 2001)), has continued the Regulations in effect 
under IEEPA.
    \2\ The violations at issue occurred from 1994 through 1996. The 
Regulations governing the violations at issue are found in the 1994 
through 1996 versions of the Code of Federal Regulations (15 CFR 
parts 768-799 (1994-1995), and 15 CFR parts 768-799 (1996), as 
amended (61 FR 12714, March 25, 1996)) (the ``former Regulations''). 
The March 25, 1996 Federal Register publication redesignated, but 
did not republish, the then-existing Regulations as 15 CFR parts 
768A-799A. In addition, the March 25, 1996, Federal Register 
publication restructured and reorganized the Regulations, 
designating them as an interim rule at 15 CFR parts 730-774, 
effective April 24, 1996. The former Regulations define the various 
violations that BXA alleges occurred and the Regulations establish 
the procedures that apply to this matter.
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    1. One Violation of 15 CFR 787.3(b): Conspiracy: Beginning in June 
1994 and continuing through July 1996, Engebretson conspired with 
Thane-Coat, Inc., Jerry Vernon Ford, TIC, Ltd. and Export Materials, 
Inc., to violate the former Regulations by devising and employing a 
scheme to export and by exporting polyurethane (isocyanate/polyol) and 
polyether polyurethane (collectively referred to as ``pipe coating 
materials''), items subject to the former Regulations, from the United 
States through the United Kingdom to Libya, a country subject to 
comprehensive economic sanctions, without applying for and obtaining 
the required export authorizations from the U.S. Government.
    2. 37 Violations of 15 CFR 787.6 and 787A.6: Exports Without the 
Required Licenses: Between on or about February 12, 1995 and on or 
about April 25, 1996, on 37 separate occasion, Engebretson exported or 
caused to be exported pipe coating materials from the United States to 
Libya without obtaining validated export licenses from the Department 
of Commerce as required by sections 772.1(b), 772A.1(b), 785.7, and 
785A.7 of the former Regulations.
    3. 37 Violations of 15 CFR 787.4 and 787A.4: Acting with Knowledge 
of a Violation: In connection with each of the exports described in 
paragraph 2 above, on 37 separate occasions, Engebretson acted with 
knowledge or had reason to know that validated licenses were required 
from the Department of Commerce before the pipe coating materials could 
be sold to Libya.
    4. 37 Violations of 15 CFR 787.5(a) and 787A.5(a): 
Misrepresentation and Concealment: In connection with each of the 
exports described in paragraph 2 above, Engebretson, on 37 separate 
occasions, filed or caused to be filed Shipper's Export Declarations or 
bills of landing, export control documents as defined in sections 7702 
and 770A.2 of the former regulations, which represented that the 
ultimate end-use of the pipe coating materials was in the United 
Kingdom. These statements of material fact were false as the ultimate 
and-use of the pipe coating materials was in Libya. These false 
statements were made, directly or indirectly, to an official of the 
U.S. Government.
    BXA and Engebretson having entered into a Settlement Agreement 
pursuant to Section 766.18(b) of the Regulations whereby they agreed to 
settle this matter in accordance with the terms and conditions set 
forth therein, and the terms of the Settlement Agreement having been 
approved by me;
    It is therefore ordered:
    First, that, for a period of 25 years from the date of this Order, 
Engebretson, and when acting for or on behalf of Engebretson, his 
representatives, agents, assigns, or employees (``denied persons''), 
may not, directly or indirectly, participate in any way in any 
transaction involving any commodity, software, or technology 
(hereinafter collectively referred to as ``item'') exported or to be 
exported from the United States that is subject to the Regulations, or 
in any other activity subject to the Regulations, including, but not 
limited to:
    A. Applying for, obtaining, or using any license, License 
Exception, or export control document;
    B. Carrying on negotiations concerning, or ordering, buying, 
receiving, using, selling, delivering, storing, disposing of, 
forwarding, transporting, financing, or otherwise servicing in any way, 
any transaction involving any item exported or to be exported from the 
United States that is subject to the Regulations, or in any other 
activity subject to the Regulations; or
    C. Benefitting in any way from any transaction involving any item 
exported or to be exported from the United States that is subject to 
the Regulations, or in any other activity subject to the Regulations.
    Second, that no person may, directly or indirectly do any of the 
following:
    A. Export or reexport to or on behalf of the denied person any item 
subject to the Regulations;
    B. Take any action that facilitates the acquisition or attempted 
acquisition by the denied persons of the ownership, possession, or 
control of any item subject to the Regulations that has been

[[Page 7355]]

or will be exported from the United States, including financing or 
other support activities related to a transaction whereby the denied 
persons acquire or attempt to acquire or such ownership, possession or 
control;
    C. Take any action to acquire from or to facilitate the acquisition 
or attempted acquisition from the denied persons of any item subject to 
the Regulations that has been exported from the United States;
    D. Obtain from the denied persons in the United States any item 
subject to the Regulations with knowledge or reason to know that the 
item will be, or is intended to be, exported from the United States; or
    E. Engage in any transaction to service any item subject to the 
Regulations that has been or will be exported from the United States 
and which is owned, possessed or controlled by the denied persons, or 
service any item, of whatever origin, that is owned, possessed or 
controlled by the denied persons if such service involves the use of 
any item subject to the Regulations that has been or will be exported 
from the United States. For purposes of this paragraph, servicing means 
installation, maintenance, repair, modification or testing.
    Third, that after notice and opportunity for comment as provided in 
Section 766.23 of the Regulations, any person, firm, corporation, or 
business organization related to Engebretson by affiliation, ownership, 
control, or position of responsibility in the conduct of trade or 
related services may also be subject to the provisions of this Order.
    Fourth, that this Order does not prohibit any export, reexport, or 
other transaction subject to the Regulations where the only items 
involved that are subject to the Regulations are the foreign-produced 
direct product of U.S.-origin technology.
    Fifth, that a copy of this Order shall be delivered to the United 
States Coast Guard ALJ Docketing Center, 40 Gay Street, Baltimore, 
Maryland 21202-4022, notifying that office that this case is withdrawn 
from adjudication, as provided by Section 766.18 of the Regulations.
    Sixth, that, the charging letter, the Settlement Agreement, and 
this Order shall be made available to the public.
    This Order, which constitutes the final agency action in this 
matter, is effective immediately.

    Entered this 24th day of January, 2002.
Michael J. Garcia,
Assistant Secretary of Commerce for Export Enforcement.
[FR Doc. 02-3854 Filed 2-15-02; 8:45 am]
BILLING CODE 3510-DT-M