Evolutions In Business • www.eib.com • (978) 256-0438 Fax: (978) 250-4529 • P.O. Box 4008, Chelmsford, MA 01824

March 15, 2017 – Volume 9, Issue 6

EIB World Trade Headlines

NEWSLETTERNOTES* CLARIFICATIONOFFEDERAL…*SecretaryofCommerce…*U.S.Departmentof…*WearableTechnologiesMarket…*ExporterOf…*ElevenIndividualsandOne…*COUNTERINTELLIGENCE...*SanctionsHighlight…*AndroidRanso…*1st3D-printed…*Rolls-RoyceAE…*MilremExhibits…*AFtoRetireMQ-1…*HowNewark…*AfterHiddenFigures,new…*CommerceSecretaryWilbur…*AerospaceComposites…*Training

CLARIFICATION OF FEDERAL REGISTER JAN 23 U.S. INDIA Licenses

FavorableLicenseapprovalfor"600"LicensesifdestinedforIndia,UnitedStatesoracountryinA-5.TherearetwoimportantpiecesofthenewregulationfocusingonthebilateralrelationshipwithIndia;firstitestablisheslicensingpoliciesofgeneralapprovalforexportsorre-exportstoortransferswithinIndiaofitemssubjecttotheEAR,including"600series"militaryitems,forcivilormilitaryendusesinIndiaorfortheultimateendusebytheGovernmentofIndia,forre-exporttoaCountryGroupA:5country,orforreturntotheUnitedStates.Thiswouldinclude9A610or9A619ifgoingtoIndia,notingitemsarenotforuseinnuclear,"missile,"orchemicalorbiologicalweaponsactivities.Second,thenewregulationamendstheenduserandenduseprovisionsoftheValidatedEndUser(VEU)authorizationin§748.15(AuthorizationValidatedEnd-User(VEU)),paragraphs(a)(eligibleenduserprovision)and(d)(end-userestrictions),toallowthatitemsobtainedunderauthorizationVEUinIndiamaybeusedforcivilormilitaryenduses.Again,therearecarveoutsforMTandWMDrelateditemsandactivities.

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Secretary of Commerce Wilbur L. Ross, Jr. Announces $1.19 Billion

Penalty for Chinese Company’s Export Violations to Iran and North Korea

SecretaryofCommerceWilburL.Ross,Jr.todayannouncedthatChina’sZhongxingTelecommunicationsEquipmentCorporationandZTEKangxunTelecommunicationsLtd.,knowncollectivelyasZTE,hasagreedtoarecord-highcombinedcivilandcriminalpenaltyof$1.19billion,pendingapprovalfromthecourts,afterillegallyshippingtelecommunicationsequipmenttoIranandNorthKoreainviolationoftheExportAdministrationRegulations(EAR)andtheIranianTransactionsandSanctionsRegulations(ITSR).Aspartofthesettlement,ZTEhasagreedtopayapenaltyof$661milliontoCommerce’sBureauofIndustrySecurity(BIS),with$300millionsuspendedduringaseven-yearprobationaryperiodtodeterfutureviolations.ThiscivilpenaltyisthelargesteverimposedbytheBISand,ifthecriminalpleaisapprovedbyafederaljudge,thecombined$1.19billioninpenaltiesfromCommerce,theDepartmentofJustice,andtheDepartmentofTreasury,wouldbethelargestfineandforfeitureeverleviedbytheU.S.governmentinanexportcontrolcase.“Weareputtingtheworldonnotice:thegamesareover,”saidSecretaryRoss.“Thosewhofloutoureconomicsanctionsandexportcontrollawswillnotgounpunished–theywillsuffertheharshestofconsequences.UnderPresidentTrump’sleadership,wewillbeaggressivelyenforcingstrongtradepolicieswiththedualpurposeofprotectingAmericannationalsecurityandprotectingAmericanworkers.”Inadditiontothesemonetarypenalties,ZTEalsoagreedtoactiveauditandcompliancerequirementsdesignedtopreventanddetectfutureviolationsandaseven-yearsuspendeddenialofexportprivileges,whichcouldbequicklyactivatedifanyaspectofthisdealisnotmet.

“TheresultsofthisinvestigationandtheunprecedentedpenaltyreflectsZTE’segregiousschemetoevadeU.S.lawandsystematicallymisleadinvestigators,”SecretaryRosssaid.“ThispenaltyisanexampleoftheextraordinarypowerstheDepartmentofCommercewillusetovigorouslyprotecttheinterestsoftheUnitedStates.IamveryproudoftheoutstandingworkoftheDepartment’sBureauofIndustryandSecurity,OfficeofExportEnforcementanditsOfficeofChiefCounsel.”

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Aspartofthe$1.19billionpleadeal,theU.S.DistrictCourtfortheNorthernDistrictofTexaswillconsiderimposing$430,488,798incombinedcriminalfinesandforfeitureonZTEaspartofapleaagreementwiththeDepartmentofJustice.ZTEhasalsoagreedtopaytheDepartmentoftheTreasury’sOfficeofForeignAssetsControl(OFAC)$100,871,266pursuanttoasettlementagreement.ZTE’sSchemeStartingnolaterthanJanuary2010andcontinuingthroughApril2016,ZTEconspiredtoevadethelong-standingandwidelyknownU.S.embargoagainstIraninordertoobtaincontractswithandrelatedsalesfromIranianentities,includingentitiesaffiliatedwiththeIranianGovernment,tosupply,build,operate,and/orservicelarge-scaletelecommunicationsnetworksinIran,thebackboneofwhichwouldbeU.S.-originequipmentandsoftware.Asaresultoftheconspiracy,ZTEwasabletoobtainhundredsofmillionsofdollarsincontractswithandsalesfromsuchIranianentities.Additionally,ZTEundertookotheractionsinvolving283shipmentsofcontrolleditemstoNorthKoreawithknowledgethatsuchshipmentsviolatedtheEAR.Shippeditemsincludedrouters,microprocessors,andserverscontrolledundertheEARfornationalsecurity,encryption,regionalsecurity,and/oranti-terrorismreasons.Inaddition,ZTEengagedinevasiveconductdesignedtopreventtheU.S.governmentfromdetectingitsviolations.TheInvestigation,Sanction,andSubsequentChargesTheBISOfficeofExportEnforcementDallasFieldOffice,inpartnershipwiththeU.S.Attorney’sOfficefortheNorthernDistrictofTexas,TheDepartmentofJusticeCounterintelligenceandExportControlSection,FBIandtheDepartmentofHomelandSecurity’sHomelandSecurityInvestigations,investigatedZTEforfiveyears,beginningin2012whenallegationsofillegalconductfirstsurfacedinmediareports.BIS’ssubsequentserviceofanadministrativesubpoenaonZTE’sU.S.affiliate,ZTEUSA,Inc.,ledZTEtoslowitsunlawfulshipmentstoIran.BISlaterlearnedthatinNovember2013,followingameetingofseniormanagerschairedbyitsthen-CEO,ZTEmadeplanstoresumetransshipmentstoIranthatwouldcontinueduringthecourseoftheinvestigation.OnMarch7,2016,theDepartmentofCommercesanctionedZTEbyaddingittotheEntityList,whichcreatedalicenserequirementtoexport,reexport,ortransfer(in-country)toZTEanyitemssubjecttotheEAR.

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TheprincipalbasisfortheadditionweretwoZTEcorporatedocumentstitled“ReportRegardingComprehensiveReorganizationandStandardizationoftheCompanyExportControlMatters,”whichindicatedthatZTEreexportedcontrolleditemstosanctionedcountriescontrarytoU.S.lawand“ProposalforImportandExportControlRiskAvoidance,”whichdescribedhowZTEplannedandorganizedaschemetoestablish,controlanduseaseriesof“detached’’(i.e.,shell)companiestoillicitlyreexportcontrolleditemstoIraninviolationofU.S.exportcontrollaws.Duringthecourseoftheinvestigation,ZTEmadeknowinglyfalseandmisleadingrepresentationsandstatementstoBISorotherU.S.lawenforcementagencies,includingthatthecompanyhadpreviouslystoppedshipmentstoIranasofMarch2012,andwasnolongerviolatingU.S.exportcontrollaws.ZTEalsoengagedinanelaborateschemetopreventdisclosuretoandaffirmativelymisleadtheU.S.Government,bydeletingandconcealingdocumentsandinformationfromtheoutsidecounselandforensicaccountingfirmthatZTEhadretainedwithregardtotheinvestigation.Thisschemeincludedformingandoperatinga13-member“ContractDataInductionTeam”withinZTEbetweenJanuaryandMarch2016,thatdestroyed,removed,orsanitizedallmaterialsconcerningtransactionsorotheractivitiesrelatingtoZTE’sIranbusinessthatpost-datedMarch2012;deletedonanightlybasisalloftheteam’semailstoconcealtheteam’sactivities;andrequiredeachoftheteammemberstosignanon-disclosureagreementcoveringtheZTEtransactionsandactivitiestheteamwastaskedwithhiding.Underthenon-disclosureagreement,teammemberswouldbesubjecttoapenaltyof1millionRenminbi(orapproximately$150,000)payabletoZTEifitdeterminedadisclosureoccurred.“DespiteZTE’srepeatedattemptstothwarttheinvestigation,thedoggeddeterminationofinvestigatorsuncovereddamningevidenceofanorchestrated,systematicschemetoviolateU.S.exportcontrolsbysupplyingequipmenttosanctioneddestinations,”saidDouglasHassebrock,DirectoroftheBureauofIndustryandSecurity’sOfficeofExportEnforcementwhichspearheadedtheinvestigation.

U.S. Department of Justice PRESS RELEASE

UKRAINIAN NATIONAL ARRESTED IN CONNECTION WITH SCHEME TO

ILLEGALLY EXPORT RIFLE SCOPES AND THERMAL IMAGING EQUIPMENT Queens Man Sought to Export

Controlled Rifle Scopes and Thermal Imaging Equipment Designed for

Military Use

FORIMMEDIATERELEASEContact:JohnMarzulliNellinMcIntoshUnitedStatesAttorney’sOffice(718)254-6323Earliertoday,VolodymyrNedoviz,alawfulpermanentresidentoftheUnitedStatesandcitizenofUkraine,wasarrestedonfederalchargesofillegallyexportingcontrolledmilitarytechnologyfromtheUnitedStatestoend-usersinUkraine.FederalagentsalsoexecutedasearchwarrantataPhiladelphia,PennsylvanialocationthatwasusedinconnectionwithNedoviz’sillegalscheme.Nedovizisscheduledtomakehisinitialappearancetodayat2:00p.m.attheUnitedStatesCourthouse,225CadmanPlazaEast,Brooklyn,NewYork,beforeUnitedStatesMagistrateJudgeRamonE.Reyes,Jr.ThearrestandchargeswereannouncedbyU.S.AttorneyRobertL.CapersoftheEasternDistrictofNewYork;ActingAssistantAttorneyGeneralforNationalSecurityMaryB.McCord;FBIAssistantDirectorinChargeWilliamF.Sweeney,Jr.,NewYorkFieldOffice;SpecialAgentinChargeAngelM.Melendez,U.S.ImmigrationandCustomsEnforcement(ICE),HomelandSecurityInvestigations(HSI)forNewYork;andSpecialAgentinChargeJonathanCarson,U.S.DepartmentofCommerce,BureauofIndustryandSecurity,OfficeofExportEnforcement,NewYorkFieldOffice.ThecomplaintallegesthatthedefendantconspiredwithotherslocatedinbothUkraineandtheUnitedStatestopurchaseexport-controlled,military-gradeequipmentfromsellersintheUnitedStatesandtoexportthatequipmenttoUkrainewithouttherequiredlicenses.

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Thedevicesobtainedbythedefendantandhisco-conspiratorsincludedsomeofthemosthighlypowerfulandtechnologicallysophisticatednightvisionriflescopesandthermalimagingequipmentavailable,including,amongothers,anArmasightZeus-Pro6402-16x50(60Hz)ThermalImagingweaponssight,aFLIRThermosightR-Series,ModelRS6460mm640x480(30Hz)RifleScope,andaATNX-SightII5-20xSmartRifleScope.Inmanycases,thedevicespurchasedbythedefendantandhisco-conspiratorsretailforalmost$9,000,andtheyarespecificallymarketedtomilitaryandlawenforcementconsumers.Aspartoftheconspiracy,inordertoinduceU.S.-basedmanufacturersandsupplierstosellthemtheexport-controlleddevicesandtoevadeapplicablecontrols,thedefendantandhisco-conspiratorsfalselypurportedtobeUnitedStatescitizensandconcealedthefacttheywereexporters.Thedefendantandhisco-conspiratorsalsorecruited,trained,andpaidotherU.S.-basedindividualstoexportthecontrolleddevicestoUkraineviavariousfreightforwardingcompanies.Amongotherthings,thedefendantandhisco-conspiratorsinstructedtheU.S.-basedindividualstofalselydescribethenatureandvalueoftheequipmenttheywereattemptingtoexport.Inaddition,toconcealtheiridentities,aswellasthetruedestinationoftheriflescopesandthermalimagingequipment,thedefendantandhisco-conspiratorsinstructedthattheitemsbeshippedusingfalsenamesandaddresses.Theexportofmilitary-graderiflescopesandthermalimagingequipmentrequiresalicensefromeithertheUnitedStatesDepartmentofStateortheUnitedStatesDepartmentofCommerce.BoththeDepartmentofStateandtheDepartmentofCommercehaveplacedrestrictionsontheexportofitemsthattheyhavedeterminedcouldmakeasignificantcontributiontothemilitarypotentialandweaponsproliferationofothernationsandthatcouldbedetrimentaltotheforeignpolicyandnationalsecurityoftheUnitedStates.“Thedefendanttriedtocircumventlawsthatprotectournationalsecuritybypreventingspecializedtechnologiesfromfallingintothewronghands,”saidU.S.AttorneyCapers.“ThosewhoseektoevadethescrutinyofU.S.regulatoryandlawenforcementagenciesbyoperatingintheshadowspresentadangertoournationalsecurityandouralliesabroad.Wewillcontinuetovigorouslyprosecuteviolationsofourlawsthathelpmaintainthesuperiorityofourarmedforcesonland,sea,andair.”Mr.CapersexpressedhisgratefulappreciationtotheFBI’sJointTerrorismTaskForce.“Exportcontrolsonmilitarytechnologyandequipmentareputinplacesomilitary-gradegeardoesn’tendupinthewronghands.Aswealleged,Nedovizcolludedwithco-conspiratorstoillegallypurchasehighlypowerful,technologicallysophisticatedequipmentintendedforlaw

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enforcementandmilitaryandthenexporttoUkrainewithouttheproperlicenses.TheFBIwillcontinuetoprotectournationalsecurityassetsasweworkwithourpartnerstopreventtheexportationofrestrictedmaterials,”saidSweeney,FBIAssistantDirectorinCharge,NewYorkFieldOffice.“Nedoviz,aUkrainiannational,falselypretendedtobeacitizenoftheUnitedStatesinordertopurchasehighlysensitivemilitarygradeequipment,thatwouldlaterbeillegallyexportedtoUkraine”saidMelendez,SpecialAgentinCharge,MelendezofHSINewYork.“Theseitemsincludingriflescopesandthermalimagingequipmenthavestrictexportcontrolsinordertomakesurethatoursoldiersoverseasneverhavetoencounterthemonthebattlefield.ItisamissionweatHSItakeveryseriously.”“Today’sarrestdemonstratestheOfficeofExportEnforcement'sstrongcommitmenttoenforcingournation'sexportcontrolandpublicsafetylaws.Wewillcontinuetoworkwithourlawenforcementpartnerstokeepthemostsensitivegoodsoutofthemostdangeroushands,”saidSpecialAgentinChargeCarson,U.S.DepartmentofCommerceBureauofIndustryandSecurity,OfficeofExportEnforcement,NewYorkFieldOffice.Ifconvictedofthecharges,thedefendantfacesupto20yearsinprisonanda$1millionfine.ThecaseisbeinghandledbytheOffice’sNationalSecurityandCybercrimeSection.AssistantU.S.AttorneysPeterW.BaldwinandMichaelKeiltyareinchargeoftheprosecution,withassistancefromTrialAttorneyDavidReckeroftheNationalSecurityDivision’sCounterintelligenceandExportControlSection.TheDefendant:VOLODYMYRNEDOVIZAge:32Queens,NewYorkE.D.N.Y.DocketNo.17-M-208

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Wearable Technologies Market Ready to Charge Into the Multi-Billion Dollars

Zone

Thetrendtowardseparatingcomputingandsensingtechnologyisaccelerating,enhancedbytheshrinkingsizeofcomponentsthatprovidetheuserwithfarsuperiorcapacitythansimilarcomponentsofgreatersizeandpowerdemand.TheU.S.GovernmenthasinvestedbillionsofdollarsannuallyoverthelastdecadeinR&Dwithacorrespondingpushtopatentandtransitiontechnologyintoprogramsofrecordand/orcommercialproducts.Theyareseekingcommercialpartnersandopeningtheirpatentportfolioforlicensingdeals.Theresultisthat,overthecomingdecade,theworld’swearabletechnologiesmarketisexpectedtogrowatacumulativeCAGRofnearly40%,producingatotalglobalmarketofnearly$8billion.Thatisoneconclusionfromanexhaustiveanalysisofthemilitaryandcommercialwearabletechnologymarket,ledbyDr.BruceFloersheim,theCOOofGOXTUDIO(www.goxtudio.com)andtheDirectorofOperationsfortheWearableRoboticsAssociation(www.wearablerobotics.com).Wearablesincludeahostoftechnologiesbeingintegratedintothe‘SoldierSystem’andintoavarietyofotherciviliansystemsandcomponentsinwaysnotpreviouslypossible.Thesetechnologiesactivelyenhancesafety,situationalawareness(localandglobal)andoperationalperformance.Thismultiple-scenarioMarketForecastreportpresentsasummaryandassessmentofcurrentcommercialandmilitarywearabletechnologies,theirprojectedevolutionarypathsoverthenextdecade,andtheimplicationsofbothtechnicalandpoliticalinfluenceontheglobalmarkets.

Exporter Of Microelectronics To Russian Military Sentenced To 135

Months In Prison Following Convictions On All Counts At Trial

EarliertodayinUnitedStatesDistrictCourtinBrooklyn,AlexanderPosobilovwassentencedto135months’imprisonmentforconspiringtoexportandillegallyexportingcontrolledmicroelectronicstoRussia,aswellasforconspiringtolaundermoney.Posobilov,togetherwithtenotherindividualsandtwocorporations–ARCElectronics,Inc.(ARC)andApexSystem,L.L.C.(Apex)–wereindictedinOctober2012.Posobilovandtwoco-conspiratorsweresubsequentlyconvictedattrialonallcountsinOctober2015.Oftheremainingdefendants,fivepleadedguiltyandthreeremainatlarge.ARCisnowdefunct,andApex,aRussian-basedprocurementfirm,failedtoappearincourt.ThesentencewasannouncedbyRobertL.Capers,UnitedStatesAttorneyfortheEasternDistrictofNewYork,andActingAssistantAttorneyGeneralforNationalSecurityMaryB.McCord.“PosobilovhelpedleadacriminaloperationthatthroughliesandsubterfugeprofitedhandsomelyfromtheunlawfulsaleandexportofsophisticatedAmericanmicroelectronicsforusebytheRussianmilitary,”statedUnitedStatesAttorneyCapers.“Today’ssentenceshowsthatthosewhocompromisethenationalsecurityoftheUnitedStatesfortheirpersonalfinancialgainwillfaceseriouspunishment.”Mr.CapersextendedhisgratefulappreciationtotheFederalBureauofInvestigation,HoustonFieldOfficeandtheDepartmentofCommercefortheirleadingrolesintheinvestigation.“Withthissentence,AlexanderPosobilovisbeingheldaccountableforevadingexportlawsandillegallyexportingAmericanmicroelectronicstoRussiaformilitaryuse,”saidActingAssistantAttorneyGeneralMcCord.“Exportlawsexistasanimportantpartofournationalsecurityframeworkandprotectingnationalassetsfromendingupinthehandsofourpotentialadversariesisoneofourhighestpriorities.”PosobilovjoinedARCin2004,whereheascendedtobecometheprocurementmanagerandday-to-daydirectorofthecompany.BetweenapproximatelyOctober2008andOctober2012,managedateamofemployeeswhoworkedtoobtainadvanced,technologicallycutting-edgemicroelectronicsfrommanufacturersandsupplierslocatedwithintheUnitedStates

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andtoexportthosehigh-techgoodstoinRussia,whileevadingthegovernmentlicensingsystemsetuptocontrolsuchexports.Thesecommoditieshaveapplicationsandarefrequentlyusedinawiderangeofmilitarysystems,includingradarandsurveillancesystems,missileguidancesystemsanddetonationtriggers.Russiawasnotcapableofproducingmanyofthesesophisticatedgoodsdomestically.Between2002and2012,ARCshippedapproximately$50,000,000worthofmicroelectronicsandothertechnologiestoRussia.ARC’slargestclientswerecertifiedsuppliersofmilitaryequipmentfortheRussianMinistryofDefense.Toinducemanufacturersandsupplierstosellthesehigh-techgoodstoARC,andtoevadeapplicableexportcontrols,Posobilovandhisco-conspiratorsprovidedfalseenduserinformationinconnectionwiththepurchaseofthegoods,concealedthefactthattheywereexporters,andfalselyclassifiedthegoodstheyexportedonexportrecordssubmittedtotheDepartmentofCommerce.UltimaterecipientsofARC’sproductsincludedaresearchunitfortheRussianFSBinternalsecurityagency,aRussianentitythatbuildsairandmissiledefensesystemsandanotherthatproduceselectronicwarfaresystemsfortheRussianMinistryofDefense.Today’ssentencingtookplacebeforeUnitedStatesDistrictSeniorJudgeSterlingJohnson,Jr.Thegovernment’scaseisbeinghandledbytheOffice’sNationalSecurity&CybercrimeSection.AssistantUnitedStatesAttorneysRichardM.TuckerandUnaA.Dean,aswellasTrialAttorneyDavidReckerfromtheNationalSecurityDivision’sCounterintelligenceandExportControlSection,areinchargeoftheprosecution.AssistantUnitedStatesAttorneyClaireKedeshianishandlingtheforfeitureaspectsofthecase.TheDefendant:ALEXANDERPOSOBILOVAge:62Houston,TexasE.D.N.Y.DocketNo.12CR626(SJ)

Eleven Individuals and One Company Charged in Florida With Exporting

Prohibited Articles to Syria

AliCaby,a/k/a“AlexCaby,”40,aU.S.permanentresidentcurrentlyresidinginBulgaria;ArashCaby,a/k/a“AxelCaby,”43,ofMiami,Florida;andMarjanCaby,34,ofMiami,Florida,werearrestedandchargedwithexportingprohibitedarticlestoSyria,inviolationoftheSyriatradeembargo,commerceregulationsandaU.S.DepartmentofTreasurydesignationbasedonanIndictmentchargingelevenindividualsandoneforeigncompany.ThedefendantswerechargedbyindictmentfortheirallegedparticipationinaconspiracytoviolatetheInternationalEmergencyEconomicPowersAct(IEEPA),theExportAdministrationRegulations(EAR),andtheGlobalTerrorismSanctionsRegulationsbyexportingdual-usegoods,thatis,articlesthathavebothcivilianandmilitaryapplication.Thedual-usegoodswereexportedtoSyrianArabAirlines,theSyriangovernment’sairline,whichisanentitydesignatedandblockedbytheU.S.DepartmentoftheTreasury’sOfficeofForeignAssetsControlfortransportingweaponsandammunitiontoSyriainconjunctionwithHizballah,aterroristorganization,andtheIranianRevolutionaryGuardCorps(IRGC).AlsochargedintheindictmentwereAdibZeno,RizkAli,AmmarAlMounajed,ZhelyazAndreev,MihaelaNenova,LyubkaHristova,IskrenGeorgiev,IvanSergiev,andSyrianArabAirlines,a/k/a“SyrianAir.”TheannouncementwasmadebyActingAssistantAttorneyGeneralforNationalSecurityMaryB.McCord,U.S.AttorneyWifredoA.FerrerfortheSouthernDistrictofFlorida,SpecialAgentinChargeGeorgeL.PirooftheFBI’sMiamiFieldOffice,SpecialAgentinChargeRobertLuzzioftheDepartmentofCommerce’sOfficeofExportEnforcement(DOC)MiamiFieldOfficeandSpecialAgentinChargeMarkSelbyofU.S.ImmigrationandCustomsEnforcement’sHomelandSecurityInvestigations(ICE-HSI).Specifically,thedefendantsarechargedwith:conspiracytoviolatetoIEEPAandtodefraudtheU.S.Government,inviolationofTitle18,U.S.Code,Section371;substantiveviolationsofIEEPAandtheEAR,specificallyTitle15,CodeofFederalRegulations,Part746.9(a),regardingtheSyrianEmbargo;smugglinggoodsfromtheU.S.,inviolationofTitle18,UnitedStatesCode,Section554(a);submittingfalseormisleadingexportinformation,inviolationofTitle13,U.S.Code,Section305;conspiracytocommitmoneylaundering,inviolationofTitle18,U.S.Code,Section1956(h);andfalsestatements,inviolationofTitle18,U.S.Code,Section1001.

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Accordingtocourtdocuments,AliCabyrantheBulgariaofficeofAW-Tronics,aMiami,FloridaexportcompanythatwasmanagedbyArashCaby,andwhichshippedandexportedvariousaircraftpartsandequipmenttoSyrianArabAirlines.MarjanCaby,AW-Tronics’exportcomplianceofficerandauditor,facilitatedtheseexportsbysubmittingfalseandmisleadingelectronicexportinformationtofederalagencies.AllthreedefendantscloselysupervisedandencouragedsubordinateemployeesofAW-TronicsinthewillfulexportationofthepartsandequipmenttoSyrianArabAirlines,whoseactivitieshaveassistedtheSyriangovernment’sviolentcrackdownonitspeople.

Anindictmentisaformalchargingdocumentnotifyingthedefendantofthecriminalcharges.Allpersonschargedinanindictmentarepresumedinnocentuntilprovenguiltyinacourtoflaw.

Mr.FerrercommendedtheinvestigativeeffortsoftheFBI,DOC,ICE-HSI,DefenseCriminalInvestigativeServiceandU.S.CustomsandBorderProtection.ThecaseisbeingprosecutedbyAssistantU.S.AttorneyRicardoDelTorooftheSouthernDistrictofFloridaandTrialAttorneyMatthewWalczewskioftheCounterintelligenceandExportControlSectionoftheDepartmentofJustice’sNationalSecurityDivision.

COUNTERINTELLIGENCE & ECONOMIC

ESPIONAGE Trade Shows Are Easy Targets for

Foreign Intelligence Breaches

ByJamesLintFacultyMember,SchoolofBusiness,AmericanMilitaryUniversitySeniorEditorforInCyberDefenseandContributor,InHomelandSecurityTradeshowsarelikeplayingpokerwithyourcompetitionstandingoveryourshoulderorlikealibrarywithnolibrarycards.Everythingiseasilyavailableandthereislotsoffreeinformation.Thequestionis:whobenefitsfromallthisinformation?Atradeshowoffersastartupcompanyanopportunitytomakeitsnewproductahouseholdname.Italsofacilitatesnetworkingopportunitiesforamarketingdepartmentlookingfornewbusiness.Inaddition,atradeshowistheperfectopportunityforbusinessexecutivestolearniftherearemarketsforanicheitemtheyproduce.However,tradeshowsarealsoopenvenuesforindustrialspyingbyunfriendlynationsseekingU.S.technology.

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IntelligenceServicesViewofTradeShowsTheBureauofIndustryandSecurityoftheU.S.DepartmentofCommercehascontroloverwhatisauthorizedforsaletooverseascompanies.TheExport.govwebsitehasaConsolidatedScreeningList.TheCSLincludespartiesforwhichtheUnitedStatesmaintainsrestrictionsoncertainexports,re-exportsortransfersofitems.Becausepeopleandcompaniesfromspecificcountriesarerestrictedfrompurchasingcertainbusinesslines,theymaylookforotheropportunitiesforacquisition.ItwouldmakenosensefortheU.S.tosellelementsofstealthtechnologytocountriesthatwishtoharmAmerica.Nocountrywouldsellmissiletechnologytoitsenemies.Soforeignintelligenceentities(FIEs)lookforotheropportunitiestoacquireU.S.technologytheycannotacquirethroughlegitimatesales.Tradeshowsprovideanopportunityforthoseentitiestoseetechnologythattheycannotpurchaselegitimately.TechniquesofIllicitCollectionVary,buttheGoalIstheSameTheFBIpamphlet,“CounterintelligenceConcernsforTradeShowsandIndustryEvents,”isdesignedtoimprovecounterintelligenceawarenessofAmericancitizensandcompaniesbydescribingmanyofthecollectionactivitiesFIEsconduct.Forexample,oneforeignagentdippedhistieintoabeakercontainingasolutionusedinaproductdemonstrationatthecompany’sbooth.Thatallowedhisnationlatertotestthesolutioninalaboratoryandgainatechnologicaladvantagethroughreverseengineering.Acompanyrepresentative’s“simplemistake”ofnotmaintainingvigilanceinthedisplayboothprovedtobealossforaU.S.company.Everyoneknowsthattheinformalsidemeetingsattradeshowscanoftenbemorevaluablethankeynoteevents.Inonecase,itcertainlywasmorevaluablefortheRussians.RussianintelligenceofficerEvgenyBuryakovspecializedineconomicintelligence.UnderunofficialcoverasaRussianbanker,heattendedconfidentialmeetingsatatradeassociationconferenceandlearnedinformationthattheRussiangovernmentwasnotauthorizedtoknow.Duringaninternationalarmsexhibition,Chinesenationalswerediscoveredtakingnotesandvideotapingeverydisplay.ThegroupalsostoleavideothatrevealedtheU.S.TheaterHighAltitudeAirDefenseSystem(THAAD),whichaDefenseDepartmentcontractorleftunprotected.Amongotherfeatures,THAADprotectsSouthKoreafromNorthKoreanmissiles.

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Currently,ChinaispressuringSeoultopreventthedeploymentofTHAADinSouthKoreabecauseofTHAAD’sabilitytoobserveaviationthreatsatgreatdistances.BecauseofChineseintelligencecollection,BeijingknowsTHAAD’scapabilitiesanddoesnotwantthesystemnearby.Often,tradeshowvendorsdonotwanttheirboothsphotographed.Butsometimesforeignintelligencepersonnelphotographthepeopleintheboothtogainidentificationinformationforpossiblerecruitment.Inaddition,theyobtainIDinformationthroughthecommontradeshowpracticeofexchangingbusinesscards.Bylearningwhothetechnicalexpertsatvariouscompaniesare,FIEsgainanadvantageforfutureintelligencetargeting.Althoughthismethodofinformationcollectioncouldbeconsideredahumanintelligencetargetingoperation,itcouldalsoassistfuturetargetingofcompanycommunications,includingemailintrusions.Infact,somecompaniesreportanincreaseofcomputerintrusionsafteratradeshow.ExtensiveScopeofTradeShowEspionageInanannualreporttoCongressonforeigneconomiccollectionandindustrialespionage,theOfficeoftheNationalCounterintelligenceExecutivestated:“Entitiesfromarecordnumberofcountries—108—wereinvolvedincollectioneffortsagainstsensitiveandprotectedUStechnologiesinFY2005,accordingtoevidenceamassedbytheCounterintelligence(CI)Community.Arelativelysmallnumberofcountries,though—includingChinaandRussia—werethemostaggressiveandaccountedformuchofthetargeting,justastheyhavesincetheCICommunityfirstbegansystematicallytrackingforeigntechnologycollectioneffortsin1997.”TheFBIofferspamphletsandonlinecounterintelligencedocumentstohelpcompaniessafeguardtheirinformationandpersonnel.Protectingintellectualproperty(IP)isimportantforthefutureoftheUnitedStatesandAmericanbusiness.ContactyourlocalFBIofficeandaskfortheCounterintelligenceCoordinator.

Sanctions Highlight China-Iran Missile Connection

TheTrumpadministrationrecentlyimposedsanctionsonIranforitsmissiletest,andthesanctionsrevealthatTehran’smissileprogramisbackedbycovertassistancefromChina.TheTreasuryDepartment'sOfficeofForeignAssetsControl,whichenforcesU.S.sanctions,saidlastweekthata“Chinese-basednetwork”washelpingprocuregoodsforIran’sballisticmissileprogram.Thesanctionsdesignated13peopleand12companieswhowereplacedundertheTreasuryrestrictionsthatprohibitanyU.S.companiesfromdoingfinancialtransactionswiththem.TheactionfollowedaflighttestJan.29ofanIranianmedium-rangemissilethatfailedashorttimeafterlaunch.ThesanctionswereunusualforidentifyingtwoChinesenationals,XianhuaJackQinandYaodongRichardYue.AlsonamedwasCarolZhou,alsobelievedtobepartoftheChineseprocurementnetworkbutwhosenationalitywasnotdisclosedbyTreasury.Additionally,twoChinesecompaniesweretargeted:NingboNewCenturyImportandExportCo.Ltd,basedintheeasternportcityofNingboandmanagedbyMr.Qin;andCosailingBusinessTradingCo.Ltd.basedinQingdao.Mr.YuetoldtheReutersnewsservicethatheiswithCosailingandhadhisbankaccountfrozen.“Iexporttolotsofcountries,andIranisacustomertoo.That’stotallynormal,”Mr.Yuesaid.Cosailingtradesinavarietyofproductsincludingindustrialmachineryandfurnaces.AninternetsearchindicatesMr.QinisNingbo’smanagerandthatitmanufacturescommutatorsforelectricmotorsandelectricaltools,aswellasvehicleparts.China’sbackingofIran’smissileprogramwasdetailedinleakedStateDepartmentcablesmadepublicontheanti-secrecywebsiteWikiLeaks.ThecablesrevealthatChinesefirmshaveprovidedarangeofmissile-relatedgoodsincludingspecialtysteel,accelerometers,ballbearingsandgyroscopes.Iran’sShahidBakeriIndustrialGrouphasacquiredChinese-madegraphitecylinders,tungstenpowderandtungstencopper-alloyingots.ThegroupisinchargeofIran’ssolid-propellantballisticmissileprogram.AreportonIran’sballisticmissileprogramfrom2008statesthatTehranwasdevelopingseveralmedium-rangeballisticmissiles,includingthedeployedShahab-3witharangeof800miles;animprovedShahab-3witharangeof1,242miles;and

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theGhadr-1witharangeof1,100miles.Anothermedium-range

missileistheSeijil,witharangeof1,200miles.

A2009StateDepartmentcablesaid:“Chinesefirmsoverthepastyearhaveofferedorsold[MissileTechnologyControlRegime]-controlledandnon-annexitemstoballisticmissile-relatedentitiesinforeigncountries,includingIran,Pakistan,andSyria.Insomecases,saleshavecontinueddespiteextensiveinformationprovidedbytheU.S.toChineseauthoritiesoutliningourconcernsaboutthesefirms’activities.”

ThetransfershaveviolatedU.S.nonproliferationlaws,theU.S.governmentsays.CIStrategicPartnershipNewsletterPage5

“Iran’scontinuedsupportforterrorismanddevelopmentofitsballisticmissileprogramposesathreattotheregion,toourpartnersworldwide,andtotheUnitedStates,”actingOFACDirectorJohnE.SmithsaidinastatementJan.3.Thesanctionsareaimedatcountering“Iranianmalignactivities,”headded.“Wewillcontinuetoactivelyapplyallavailabletools,includingfinancialsanctions,toaddressthisbehavior,”hesaid

Android Ransomware Attacks Have Grown by 50 Percent in a Year

February21,2017

Cybercriminalsareincreasinglytargetingmobiledeviceswithmalicioussoftware,asmoreandmorepeopleusethemtostoretheirmostpersonaldata.

RansomwaretargetingAndroidusershasincreasedbyover50percentinjustayear,ascybercriminalsincreasinglytakeaimatwhattheyviewasaneasyecosystemtopenetrate.

This,thehighestnumberofattemptstoinfectAndroidsmartphonesandtabletswithmaliciousfile-encryptingsoftwaresofar,comesasusersincreasinglyturntomobilesastheirprimarydevices,storingmoreandmorevaluabledataonthem.

AccordingtocybersecurityresearchersatESET,thebiggestspikeinransomwareattackscameinfirsthalfof2016.Andbecauseransomwarewasthenarelativelynewattackvector--atleastwhenitcametotargetingbusinesses--meansmanyfellfoulofit.

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EasternEuropewasinitiallythemaintargetofransomwaredistributorsbutthishaschanged,withfiguresinESET'sTrendsinAndroidRansomwarepapersuggestingthatnow72percentofsuccessfulransomwareattacksdistributingLockerpinransomwaretargetusersintheUnitedStates.Thereasonfortheshiftintargeting,aswithmostothercybercriminaldecisionmaking,comesdowntomoney.MobileusersintheUSarericherthanthoseinEasternEurope,sodistributorsofransomwarecanmakemoremoneybytargetingthem.

1st 3D-printed aircraft component takes to skies at FRCSE

Militarypilotshavetostaycoolunderpressure,andthefirst3D-printedcomponentatFleetReadinessCenterSoutheastwillhelpthemstaythatway.Theforearm-lengthpieceofairducttubing,constructedwithacompositematerialknownasUltum1085,markedamajorstepforwardfortheNavycommandthatischargedwithmaintaining,repairingandoverhaulingaircraft.“Thisisanawesomemilestoneforourfacility,”saidFRCSECommandingOfficerCapt.ChuckStuart.“ItshowstheinnovativeapproachesourartisansandengineersincorporatetohelpsupporttheU.S.militaryeveryday.”Thefacility’sfirst3DprinterbecameoperationalinJune2014.Sincethen,artisansandengineershaveputittogoodusemakingpartsforsupportequipment,forprototypestosaveoncostlymaterialandfortooling–butneverbeforeforanactualpieceofanaircraft.ThatallchangedinJanuarywhenMatthewHawn,anaerospaceengineeratthefacility’straineraircraftprogram,soughthelpfromthemanufacturingdepartmentaftertheoriginalmanufactureroftheT-44Pegasusexhausteditssupplyofapieceofairductusedtocirculateairthroughouttheplanescockpit.RandyMeeker,atoolingmakeratthefacilitywhorunsthe3Dprinter,putforthanotheroption.“Wewentovertomanufacturingandtookalookatmakingavacuumformofthetube,whichishowtheoriginalpartwasmade,”Hawnsaid.“ThenRandybroughtupthepossibilityof3Dprintingthepart.

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“Fromthere,thecostanalysisbetweenthetwoshowed3Dprintingwascheaperandofferedabettermaterial.”NotonlydidMeekerreplicatethepieceusingthe3Dprinter,heimprovedonthedesign.“Theoriginalpiecewasmadeoutoftwopiecesofclearplastictubingthathadaflangeallthewaydownitslength,”hesaid.“Iredesignedittoworkbetterthantheplasticmodel.“Itdidn’tneedtobetwopieceswhenIcouldprintitasonepiece.”Meeker,whoworksasapitcrewmanonaracingteam,saidsometeamshavebegunprintingpartsforracecars.However,theprocessforanaircraftdemandsabitmorecautionbecausetheplanemostlikelywon’tbeonthegroundifapartfails.“Thereisalotofresponsibilityontheengineerforthesepartsthatareactuallyusedinaircraft,”hesaid.“It’sawholenewworldoftechnology,andit’stheirresponsibilitytomakesureitcanbeusedsafely.“That’swhythisparticularprojectwasagoodfirstcandidatebecauseit’snotaflight-criticalpart,butit’sastepforwardinincorporating3-Dprintedpartsintoaircraft.”

Rolls-Royce AE Engine Family Hits 70

M Flight Hours

TheRolls-RoyceAEenginefamilyhastopped70millionengineflighthours,amassingarecordofdependableandefficientserviceacrossmilitaryandcommercialfleetsintheUSandaroundtheworld.Rolls-RoyceAEenginespowerC-130Js,V-22s,GlobalHawksandanumberofmilitary,corporateandregionalaircraft.TheyareinservicewiththeUSAirForce,Marines,Navy,CoastGuard,NASAandmultiplemilitaryandcivilcustomersaroundtheworld.TheAEenginelinebeganasapowerplantfortheV-22tiltrotoraircraftfortheUSMarineCorpsandUSAirForceSpecialOperationsCommand,withfirstflightoftheV-22in1989.Derivativesoftheenginesoonfoundtheirwayontootheraircraftasthepoweranddependabledesignprovedadaptable.AllRolls-RoyceAEenginesshareacommonenginecore,andareabout80percentcommonintheirmanufacture.

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Theresultisapowerfulandreliableengine,producedcost-effectivelyononeengineassemblylineattheRolls-RoycefacilityinIndianapolis,US.Rolls-Roycehasdeliveredmorethan6,500AEenginesforavarietyofplatforms.PhilBurkholder,Rolls-Royce,PresidentDefenseAerospace,said:“TheversatilityanddependabilityoftheRolls-RoyceAEenginefamilyislegendary,andhasbeenproveninmorethan70millionflighthoursinmilitaryandcommercialservicearoundtheworld.Andthere’smoreinnovationtocome:anAE1107enginewillprovidethepowerforthenewDARPAX-Plane.”TheAEenginefamilyincludes:AE1107:PowerstheV-22,AuroraLightningStrike(DARPAX-Plane)andUSNavyShip-to-ShoreConnector.AE2100:PowerstheC-130J,C-27J,Japan’sUS-2,LM-100JandSaab2000.AE3007:PowerstheGlobalHawkandTritonUAVs,EmbraerERJandLegacy600/650,TextronAviationCessnaCitationXandX+.

Milrem Exhibits Its Fully Customizable

UGV

Milrem,theEstoniandefencesolutionsprovider,hasjoinedforceswithRaytheonUK,AdvancedElectronicsCompanyandIGGAselsanSystemstodeploytheirfullymodularhybridunmannedgroundvehicleTHeMISintheMENAregion.TogetherwiththesestrongpartnersMilremisexhibitingthreedifferentsolutionsoftheworld’sfirstfullymodularhybridunmannedgroundvehicletheTHeMIS.MilremwillberepresentedattheIGGstandwiththefirstweaponizedunmannedgroundvehicleintendedspecificallyfortheUAEmarket.ThevehiclefeaturesMilrem’sTHeMISandAselsansSARPremoteweaponstation.ThegoalofthetwocompaniesistodeploythisvehiclewiththeUAEGHQ.TogetherwiththeAdvancedElectronicsCompanyMilremisexhibitingtheTHeMISasatransportsolutionintendedtocarryasquad’sgear.Thevehicleisabletocarryupto750kgofweightandrunupto10hours.ThethirdMilremvehiclecanbefoundattheEstonianPavilionwithotherEstoniandefencecompanies.ThevehiclethereisequippedwiththeGroundEye,anIEDdetectiondevicesdevelopedbyRaytheonUK.

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“ThesuccessofMilrem'ssolutionsintheMiddleEast,AsiaaswellasUSAisagreatproofthatresearchanddevelopementinasmallcountrylikeEstoniaisverymuchpossibleandinaveryhighlevel,”saidMargusTsahkna,theDefenceMinisterofEstonia.“BeingrepresentedatthreestandswiththreedifferentcompaniesshowsexactlyhowcustomizablethefirstfullymodularhybridunmannedgroundvehicleTHeMISis,”saidKuldarVäärsi,ChiefExecutiveOfficerofMilrem.“Oneplatformcanbeequippedwithspecificpayloadsneededbytheregion'sarmies,”headded.InadditiontousingtheTHeMISasanequipmenttransport,weaponstationandIEDdetectionvehicle,theTHeMIScanalsobeusedasamedevac,UAVlandingandpoweringplatform,asensorarrayetc.Thevehicleusesonebaseplatformfordifferentapplications,loweringmaintenanceandtrainingcosts.

AF to Retire MQ-1 Predator, Transition to MQ-9 Reaper

Forthepast21years,theAirForcehasflowntheMQ-1Predatorremotelypilotedaircraftincombat,andforthelast10,theMQ-9Reaper.Combinedwithaskilledaircrew,theseaircraftprovideconsistentsupportindailyengagementsmakinganimpactdownrange.WhiletheMQ-1hasprovidedmanyyearsofservice,theAirForceplanstoretiretheMQ-1earlynextyeartokeepupwiththecontinuouslyevolvingbattlespaceenvironment.TheMQ-9isbetterequippedthantheMQ-1duetoitsincreasedspeed,high-definitionsensorsandtheabilitytocarrymoremunitions.ThesecombatattributesallowtheMQ-9tocompleteawiderarrayofmissionsets,whichcanhelptheAirForcestaypreparedinthefight."Whenyouaskaboutreadiness,youhavetoaskreadyforwhat?"saidAirForceCol.Joseph,the432ndOperationsGroupcommander."Ifwetalkaboutthethingswecouldbereadyforandwhatweshouldbeaskingourattacksquadronstodo,thentransitioningtoanallMQ-9forceisimperativeforreadiness."CloseAirSupportMissionCurrentareasofresponsibilitycalluponcombatremotelypilotedaircraftformoreprecisecloseairsupportengagementsfromtheattacksquadrons,aconsiderablechangefromthedayswhenunmannedaircraftwereusedsolelyforintelligencegatheringandreal-timereconnaissance.

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"ThereasonthattheMQ-9hasturnedintoa[closeairsupport]platform,andthisisthekeypoint,isthefusionoftwothings,"Josephsaid."Thefirstthingisthetechnology.Wetookanairplaneandoutfitteditwithmorerawpowerandcapability,butthenwedidtheotherhalfandmattedthattechnologywithaprofessionalaircrew."Healsoexplainedathirditem,whichisthetrustdevelopedwithcombatantcommandersandtroopsontheground.Thisconfidence,combinedwithanever-changingbattlefield,spawnedincreaseddemandanddesireformorecombatunmannedaircraftsupport.WhiletheMQ-1andthecrewswhoflewthemprovedtheirweaponsproficiency,itwasneveroriginallydesignedtocarryweapons,resultinginalimited200-poundpayload.ThedemandformoreattackcapabilitiesexceededtheMQ-1’sdesign."InthecaseoftheMQ-1,Ithinkwewantedmoreoutofit,butwewereataphysicalstopontheairplaneandneededanewone,"Josephsaid.ThefreshMQ-9designpickedupwheretheMQ-1leftoff,boastinganearly4,000-poundpayloadandtheabilitytocarrymissilesandbombs.TheseupgradedcapabilitiesdirectlyimpactcombatreadinessandtransitioningtojusttheMQ-9willalsohelptheaircrewsstayprimedandreadytogo."Havingasingleaircraftbuysmoreflexibility,simplifiestrainingandlogisticsandgivesourpeoplemore[careerprogression]opportunities,"Josephsaid."Ican'tmovemypeopleinbetweensquadronswithoutpayingthepenaltyofhavingtotrainthemonanotheraircraft”Money-SavingChangeTheAirForcewillnolongerhavetomaintainatrainingpipelineorequipmentontwoseparateaircraft,whichalsoeliminatesthecostofoperatingtwodifferentairframes.Instead,everythingwillbespecifictotheMQ-9.The20thAttackSquadronatWhitemanAirForceBase,Missouri,ismakingtheconversionfromMQ-1toMQ-9."RightnowtheplanistostopflyingtheMQ-1in2018,andthatmeansweneedtogettransitionedthisyear,"saidAirForceLt.Col.James,the20thAttackSquadroncommander."Aspartofthat,wearegoingtostopflyingtheMQ-1completelybyJuly1,2017.WewillgraduallystandupournumberofcombatlinesontheMQ-9,sobytheendoftheyearweareonlyanMQ-9squadron."

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How Newark hardware maker Logitech wants to take on Apple and Google

LogitechInternationalCEOBrackenDarrellsayshewilltakeonthetechgiantsbypushinghiscompanyfurtherintothesmarthomesector.

Logitech,whichmaintainsitsAmericanheadquartersinNewark,hasseenstellarsalesonaccessoriesthatpairwithsmartdevicesfromthelikesofApple,Microsoft,AmazonandGoogle.DarrellnowplanstocompetewiththosecompaniesbytyingtogetherTVs,appliancesandvoice-controlleddevices,accordingtoBloomberg.

ThecompanyhasbeeningoodhandswithDarrellthusfar—thehardwarecompany’sstockhasquadrupledsinceDarrelltookthereinsasCEOin2013.DarrellbelievesgoingforwardthatLogitechcanfindprofitablenichesthatwon’tstirupdispleasureamongindustryleaders.

“There’snowaythesebigplayersaregoingtowanttobeineverylittlepuddlearoundtheiroperatingsystems,”DarrelltoldBloomberg.“We’vealwaysbeenincategorieswherethebigplayersare.”

Thecompanyisnowresearchinghowgesturescanreplacecomputermiceandisworkingondevicesdesignedforuseinself-drivingcars,perthereport.LogitechisalsoworkingoncloudservicestiedtoLogitechproducts—forexampleoneservicewouldallowausertostorevideocollectedviahome-surveillancecameras.Darrellalsohopestomovethecompanyintovideocollaborationandaugmented-realitygames.

Logitech’skeyboards,wirelessmiceandspeakersarecurrentlykeepingupwithtrendsinthemarket.Logitech’sUEBoomspeakersalreadyunderstandApple’sSiriandGoogleNowandthecompany’sremotesemployAmazon’sAlexatocontrolTVs,lightsandheatingunits.Darrellplanstomovefurtherintothevoice-activateddevicesectorwithprofitsfromthecompany’s$1billioninsales,pertheBloombergreport.Logitech’srevenueisexpectedtoreach$2.2billionthisyear.

Butcanthecompanykeepupwiththeverycompaniesitmakesaccessoriesfor?Logitechdevoteslessthan$150millionannuallytoresearchanddevelopment,whileMicrosoftspentabout$12billiononR&Dlastyear,Googlespendsabout$14billion,andAmazonspends$16billion,perBloomberg.

DarrellspenthisfirstthreeyearsatLogitechcuttingcostsbyshuttingdownandsellingitsless-profitablebusinesses.HejoinedLogitechin2012afterspendingfouryearsatWhirlpool,healsospenttimeatGeneralElectricCo.andProcter&GambleCo.

WhatisuniqueforJames'squadronissomeoftheaircrewsaretrainingontheMQ-9fortwotothreemonths,whilehome-stationcrewsarestillflyingtheMQ-1indailycombatmissionsoverseas.

"ForthebetterpartofthelastfewmonthsI'vehadupwardsof30percentofmysquadrongoneatanytime,"Jamessaid."It'sbeenquiteachallenge,butthemotivationisveryhightotransitiontothismorecapableairframe,andmysquadronisexcitedtotakeittocombat."

"We'reconvertinganMQ-1squadronincombat24/7/365toanMQ-9squadronincombatoperationswithouttakingasingledayoutofcombat,"Josephsaid."Theherculeaneffortsdonebythe20th[AttackSquadronare]nothingshortofremarkable."

The20thAttackSquadronandeveryunitwhichflewtheMQ-1achievedsignificantcombatzoneeffectsdailywhilelayingthefoundationforfuturecombatunmannedaircraft.

"IthinkwhenwelookatthelegacyoftheMQ-1we'regoingtobescratchingourheadswonderinghowwedidsomuchwithsolittle,"Josephsaid."Themenandwomenflyingthemstartingwithtwosquadronstookascienceprojectandthroughoutmanyevolutionarychangesmadeitwhatitistoday."

TheMQ-1beganastheRQ-1Predator,anunarmedunmannedaircraftflownbyline-of-sight.SomechangesincludetheaddingoftheMulti-SpectralTargetingsystem,theadditionofweaponsandremote-splitoperationscapability.

"TheMQ-1isagreatexamplewheretheAirForcetookatechnologydemonstratorandturneditintoamajorweaponssystemhavingdailyeffectsonthebattlefield,"Jamessaid."Wehavefoundhowtoflyanimperfectweaponssystemverywell,andIthinkwehavemaximizedtheeffectivenessthatwecangetoutoftheMQ-1.IhavenodoubtthatwewillcontinuetofindwaystobemoreeffectiveincombatwiththeMQ-9."

Jamesalsosaidthedesireforthereal-timereconnaissanceandpersistentstrikecapabilitiesthatcombatunmannedaircraftaircrewprovidetothecombatantcommanderswouldneverstop.

"We'rehittingahomerunbygoingtotheMQ-9,"Jamessaid."Wehavemadeadifference."

13

After Hidden Figures, new program seeks to flood aerospace with women

LoriGarverhadjustboardedaplanelastJunewhensheheardthatheryoungfriend,D.BrookeOwens,hadpassedaway.Owens,35,hadhadterminalcancerforalongtime,butthemomentstillstungGarver,theformerdeputyNASAadministrator.She'dmentoredOwenstowardherdreamofrunninganairport,andthetwohadbecomeclose.Duringthosefewminutesbeforetheplanetookoff,Garversaidshejustcouldn'tletitgo.Soshedashedoffane-mailtofriendsandcolleaguesintheaerospacebusiness—chiefexecutives,managers,andbright,youngchiefsofstaffshe'dworkedwithatNASAandintheWhiteHouse.Wouldtheybeinterestedinmentoringyoungwomeninterestedingettingintotheaerospaceindustry?"Mygoal,sittingonthatairplane,wastogetfiveormaybeatmost10internships,"GarvertoldArsinaninterview.Butbythetimeherflighthadlanded,Garver'sinboxwasfullwithinterestedcompanies.TwootherclosefriendsofOwens—CassieLee,thedirectorofAerospaceApplicationsatVulcan,Inc.,andWilliamPomerantz,thevicepresidentofspecialprojectsatVirginGalactic—saidtheywantedtohelporganizetheprogram.OnWednesday,lessthanayearafterherpassing,theBrookeOwensFellowshipProgramlaunchedwith36paidinternships.Garversaidtheaerospaceindustryhasafairlygoodrecordwithbreakingthroughtheglassceiling.Thechiefexecutivesoftwoofthemajorplayersintheindustry,LockheedMartin'sMarillynHewsonandAerojetRocketdyne'sEileenDrake,arebothwomen."Ithinkthebiggerissueisourrawnumbers,becausewedon’thavenearlyenoughwomeninanypartofthepipeline,"saidGarver,whoservedasNASA'sdeputyadministratorfrom2009to2013andisnowgeneralmanageroftheAirLinePilotsAssociation."Icansayfromfirst-handexperience,ifyou’reinameetingandyou’retheonlywomanthere,orjustoneofahandful,you’remuchmoreeasilydismissedorignored,"shesaid."IwatchedHiddenFiguresandjustcriedthewholetime,thatourindustryhasn’tchangedmoresincethen."RecallinghermentoringexperiencewithOwens,Garverandhercofoundersfiguredthebestwaytoremedytheproblemwastobringyoungwomeninterestedinaviationandspaceexplorationintomajorcompaniesinthefield,providethemeachwithtwosenioraerospaceprofessionalsasmentors,andgivethemexperience.Eachclassofwomenwillalsoattendaconferenceand,Garverhopes,formacohortthatwillhelpthemnetworkthroughouttheircareers.

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Ultimately,itdidn'tprovedifficulttofindinterestedCEOs.CompaniessuchasSpaceX,BlueOrigin,VirginOrbit,OrbitalATK,andmanymoreprovidedinternships.Somecompanieswantedtoofferseveral."Itendedupbeinganeasysell,"Garversaid."Itwasn'thardtoconvinceacompanytobringinafantasticyoungwoman."

Commerce Secretary Wilbur Ross: If we don't use robots, everyone else

will

UnlikefellowbillionaireBillGates,CommerceSecretaryWilburRossdoesn'tseeataxasasolutiontothethreatofjobautomation."I'mnotinfavoroftryingtoholdbacktechnologicaladvance,"RosstoldCNBC's"SquawkAlley"onTuesday."Weneedtechnologicaladvance.Andifwedon'temployrobots,theChinesewill,theVietnamesewill,theEuropeanswill,theJapanesewill.Everyonewill."Rosswasaskedabouttheideathatincomegeneratedbyrobotsshouldbetaxedatsimilarlevelstohumanincometax—asuggestionMicrosoftco-founderGatesmadeinaninterviewwithQuartzlastmonth.AsamemberofthenewRepublicanadministration,RosstoldCNBCthatregulationwasnotthewaytojumpstartAmerica'saspirationstobringbackmanufacturingjobs.Rosscalledoverregulationthe"singlemostimportantthingthatbars"effectivebusinessdecisions.WilburRoss,U.S.SecretaryofCommerce,speaksduringanewsconferenceattheU.S.DepartmentofCommerceinWashington,D.C.,U.S.,onTuesday,March7,2017."TherightsolutionistoproperlyequiptheAmericanworkforce,nottotrytoholdbacktechnology,"Rosssaid.Ross,whomademuchofhisestimated$2.5billionfortunebybuyingdistressedbusinesses,suggestedthatimprovementstothecommunitycollegesystemmightbeonewaytoequipyoungpeopleandthemiddle-agedpeople"tobepartoftheworkforceofthefuture."Moretaxes,ontheotherhand,mighthandicapAmericanbusiness,hesaid.DespitetheshiftofpowerinWashington,Ross'commentscameamidbipartisaneffortstoretrainU.S.workers.InDecember,PresidentBarackObama'sadministrationreleasedareportonartificialintelligencenotingthatU.S.workersdisplacedfromtheirjobshaveseensubstantialandlastingdeclinesinearnings.

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Beforetakingoffice,PresidentDonaldTrumpsaidhetalkedtoGatesabouttheissueofautomation."Rightnowwedon'tmaketherobots,"TrumptoldTheNewYorkTimesofhisconversationwithGates."Wedon'tmakeanything.Butwe'regoingto,Imean,look,roboticsisbecomingverybigandwe'regoingtodothat.We'regoingtohavemorefactories."Rosssaidhewouldleaveittotechnologycompaniestodeterminetheeconomicbenefitsofinnovationssuchasspacetravel.Butthatdoesn'tmeanhehasgoneeasyonthetechindustry.RossleveledaheftypunishmentagainstaChinesesmartphonecompanyonTuesday,sayinghewas"puttingtheworldonnotice."ZTEagreedtopleadguiltyandpayabout$900milliontotheUnitedStatestosettleallegationsthatitviolatedAmericanlawsonsellingU.S.technologytoIraninviolationofU.S.sanctions.Ithasagreedtopayanother$300million,suspendedduringaseven-yearperiod,ifitdoesnotholdupitspartoftheagreement."Industrialpoweris,attheendoftheday,anationalsecurityissue,"Rosssaid.

Aerospace Composites Market Estimated to Reach US$ 24.8 Bn by

2024; Global Industry Analysis 2016 - 2024: Transparency Market Research

TransparencyMarketResearchhaspublishedanewreporttitled"AerospaceCompositesMarket-GlobalIndustryAnalysis,Size,Share,Growth,Trends,andForecast,2016-2024."Accordingtothereport,theglobalaerospacemarketwasvaluedatUS$11.5Bnin2015andisanticipatedtoreachUS$24.8Bnby2024,expandingataCAGRof9.1%between2016and2024.Aerospacecompositematerialsarethecompositematerialswhichareusedintheaviationindustryduetotheirattractivemechanicalandchemicalproperties.Carbonfibercompositesandglassfibercompositesarethecommonlyusedcompositesinaerostructures.Duetotheirkeypropertiessuchaslow density,lowcarbonemissionandhighfuelefficiency,carbonfibercompositesarepreferredtoothercomposites.Majorapplicationsofaerospacecompositesareincommercial&businessaircraft,helicopters,militaryandspacesectors.Increasingairpassengertraffic,emergingeconomies,growingnumberoflowcostcarriers,increasedcompetitionamongglobalaircraftleadersaredrivingthemarketfor aerospacecompositesmarket.

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Basedontheproducttype,globalaerospacecompositesmarketissegmentedintocarbonfibercomposites,glassfibercomposites,aramidfibercompositesandotherswhichincludeceramicandmetalfibercomposites.Carbonfibercompositesaccountedformorethan55%shareofthetotalaerospacecompositesdemandin2015.Theproductionofcarbonfibercompositesisacomplexundertakingasittakesnumberofintermediatestepstocompletetheprocess.Othercompositessuchasglassfibercomposites,aramidfibercompositesandothersarecomparativelyeasytomanufacture.However,theseareunlikelyoutperformcarbonfibercompositesintermsoffuelefficiencyandlowcarbonemissions.Intermsofapplications,aerospacecompositesmarkethasbeencategorizedintocommercial&businessaircraft,helicopters,militaryandspace.Inthepresentmarketscenario,commercial&businessaircraftistheleadingapplicationsegmentwithmorethan50%ofthemarketshare.Helicoptersegmentisalsoonthepathofprogress.Spaceandmilitaryarethetwosectorsthatareexpectedtohavefastergrowthintheforecastperiodduetoincreasinginvestmentsinthemilitaryandspacesectors.Intermsofvolume,NorthAmericaaccountedforasignificantshareinaerospacecompositesmarketin2015followedbyEurope.Thistrendisexpectedtocontinueduringtheforecastperiodduetotheincreasingdemandforcompositeswithlowcarbonemissionsandhighfuelefficiency.FleetexpansioninNorthAmericaandgrowingdemandfordomesticaviationinEuropeareexpectedtopropeltheaerospacecompositesmarketintheseregions.FurtherriseinairpassengertrafficisexpectedtofueltheaerospacecompositesmarketinAsiaPacific.Policyofliberalization,impressiveinvestmentsinthemilitaryandspaceprogramsareanticipatedtopropelthemarketintheregion.GrowingnumberoflowcostcarriersinLatinAmericaisindicatesfurthermarketopportunitiesforaerospacecompositesintheregion.MiddleEast&Africa,geographicallyaninternationalconnectivityhubisalsoexpectedtowitnessanimpressivegrowthopportunityforaerospacecompositesmarket.MajorplayersoperatingintheaerospacecompositesmarketincludesCytecSolvayGroup,HexcelCorporation,KoninklijkeTenCate,TorayIndustriesInc.,SGL-TheCarbonCompany,HuntsmanInternationalLLCTheAerospaceCompositesmarkethasbeendividedintothefollowingsegments.

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EIB World Trade H

eadlines Evolutions In Business • w

ww

.eib.com • (978) 256-0438 • P.O

. Box 4008, Chelmsford, M

A 01824

AerospaceCompositesMarket-ProductTypeAnalysis• CarbonFiberComposites• GlassFiberComposites• AramidFiberComposites• Others

AerospaceCompositesMarket-ApplicationTypeAnalysis▪ Commercial&Businessaircraft▪ Military▪ Helicopters▪ SpaceAerospaceCompositesMarket-RegionalAnalysis▪ NorthAmerica◦ U.S.◦ Canada▪ Europe◦ Germany◦ France◦ U.K.◦ Italy◦ Spain◦ RestofEurope▪ AsiaPacific◦ China◦ India◦ Japan◦ ASEAN◦ RestofAsiaPacific▪ MiddleEast&Africa◦ GCC◦ SouthAfrica◦ RestofMiddleEast&Africa▪ LatinAmerica◦ Brazil◦ Mexico

Training

BISSeminars–Denver,COandSanDiego,CARegistrationisnowopenfor“ComplyingwithU.S.ExportControls”seminarsinDenver,COandSanDiego,CA.

•March22and23,2017,Denver,COClickheretoregister:http://wtcdenver.org/event-2383326?CalendarViewType=1&SelectedDate=3/28/2017

•April11and12,2017,Coronado(SanDiego),CAClickheretoregister:https://www.regonline.com/Register/Checkin.aspx?EventId=1848598

“ComplyingwithU.S.ExportControls”isatwo-dayprogramledbyBIS'sprofessionalcounselingstaffandprovidesanin-depthexaminationoftheExportAdministrationRegulations(EAR).TheprogramwillcovertheinformationexportersneedtoknowtocomplywithU.S.exportcontrolrequirements.Presenterswillconductanumberof"hands-on"exercisesthatwillprepareyoutoapplytheregulationstoyourowncompany'sexportactivities.Continuinglegaleducationcredit(MCLE)isavailable,andvarieswiththelengthofeachseminar,forCaliforniaStateBarmembers.Foradditionaldetailsontheseseminars,pleasecontacttheBISWesternRegionalOfficeat949-660-0144or408-998-8806.WebNotice:TheDirectorateofDefenseTradeControls(DDTC)iscurrentlyintheprocessofmodernizingitsITsystems.Duringthistimeperiod,weanticipatetheremaybedelaysinresponsetimesandtimetoresolveITrelatedincidentsandrequests.Weapologizeforanyinconvenience,andappreciateyourpatiencewhileweworktoimproveDDTCservices.Ifyouneedassistance,pleasecontacttheDDTCServiceDeskat(202)663-2838,oremailatDtradeHelpDesk@state.gov(06.28.16)NOTE:InaccordancewithTitle17U.S.C.Section107,thismaterialisdistributedwithoutprofitorpaymentfornon-profitnewsreportingandeducationalpurposesonly.

Reproductionforprivateuseorgainissubjecttooriginalcopyrightrestrictions.

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