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US Defense Contractor Illegally Exported Data to China, DOJ Says

A Missouri-based defense contractor illegally sent export-controlled military technology data overseas to produce items for his contracts with the Defense Department, DOJ announced last week.

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David Murar, owner of Midwest Metals, St. Louis Loft Metals and Florence Metals, admitted to fraudulently bidding on at least nine government contracts in 2022. Although he told DOD he would only “provide parts from domestic sources” and signed an agreement not to send export controlled data to anyone other than his employees, he still sent quotes, diagrams and other information to suppliers in China, Hong Kong and elsewhere to obtain those parts. DOJ said Murar removed “export control and arms export control warnings” from those documents before sending them.

By sourcing the parts from overseas, Murar was able to underbid domestic suppliers, DOJ said. After they were manufactured, Murar wired funds to buy the parts and had them sent to his home in St. Charles. The agency said he repackaged the parts “to conceal their origin overseas.” Murar used the scheme to secure at least $333,465 worth of contracts for nuts, bolts, washers, sleeves and tools.

“Knowingly removing export control markings and illegally transmitting export-controlled military technology data overseas to produce substandard components for vital DOD contracts, while purporting the same to be made in America, puts U.S. warfighters at risk and undermines our national security,” said Aaron Tambrini, special agent in charge of the Bureau of Industry and Security’s Chicago field office. U.S. attorney Sayler Fleming said the case “should serve as a stern warning to those whose actions could endanger members of the armed forces or who supply confidential data on military equipment to overseas entities.”

Murar was charged with one felony count of conspiracy to commit wire fraud, which carries a maximum 20-year prison term, a fine of up to $250,000 or both prison time and a fine. His sentencing is scheduled for May 7.