Honeywell, a major American aerospace and engineering firm, has been fined 13 million dollars by the U.S. Department of State for transferring critical military secrets to the Chinese communist regime and other countries. The department arrived at the 13 million dollar settlement following “an extensive compliance review” of the company by the Office of Defense Trade Controls Compliance in the Bureau of Political-Military Affairs.
The Charlotte-based company was found to be involved in “alleged unauthorized exports and retransfers of ITAR-controlled technical data that contained engineering prints showing dimensions, geometries, and layouts for manufacturing castings and finished parts for multiple aircraft, gas turbine engines, and military electronics to and/or within Canada, Ireland, Mexico, the People’s Republic of China, and Taiwan,” according to a statement from the State Department.
Honeywell is a Fortune 100 company and employs around 110,000 workers globally, with around 44,000 workers in the United States. In 2019, Honeywell was ranked 92 on the prestigious Fortune 100 list. The company operates in the four key areas of aerospace, performance materials and technologies (PMT), building technologies, and safety and productivity solutions (SPS).
Back in 2016, the company voluntarily disclosed some of its violations to the Department of State. Two years later, Honeywell informed the department of another set of unapproved exports that were “similar in violations” to the first voluntary disclosure. Since the company proactively disclosed its violations, officials did not “administratively debar” Honeywell at the time.
In the settlement this year, the company was found guilty of 34 charges. The materials transferred to China include drawings of certain components and parts for the engine platforms of F-22 Fighter aircraft, B-1B Lancer Long-Range Strategic Bomber, and the F-35 Joint Strike Fighter. The department said the company’s actions “harmed U.S. national security.”
Honeywell contested that some of the transferred technology is already commercially available worldwide, and claimed that detailed engineering plans and manufacturing expertise had not been leaked. The company made a commitment to resolving all issues and taking the necessary steps to prevent repeat incidents.
Out of the 13 million dollars of civic and other penalties imposed on the company, five million dollars may be suspended if the funds are used for “remedial compliance measures.” The company has signed a 36-month Consent Agreement, and an external Special Compliance Officer will be deployed to the company for the first 18 months to oversee the implementation of the agreement. Honeywell’s compliance program will also undergo an external audit during the agreement period.
International tensions build
Earlier this year, Honeywell was one of the principal contractors of a military sales deal signed between the United States and Australia. The 1.68 billion dollar deal supplied Australia with M1150 Assault Breacher Vehicles, 160 M1A1 tank structures for building M1A2 SEPv3 Abrams Main Battle Tanks, and other vehicles.
“This proposed sale will support the foreign policy and national security objectives of the United States. Australia is one of our most important allies in the Western Pacific. The strategic location of this political and economic power contributes significantly to ensuring peace and economic stability in the region. It is vital to the U.S. national interest to assist our ally in developing and maintaining a strong and ready self-defense capability,” DSCA said in a press release.
Honeywell’s fines for transferring military information to China coincides with conflicts between Washington and Beijing on several fronts. U.S. Secretary of State Antony Blinken recently accused China of acting repressively at home and aggressively internationally. In an interview with CBS News, he stated that although the United States does not want to hold China down, it will not allow the communist nation to undermine the rules-based global order. He also highlighted President Joe Biden’s concerns about China’s theft of American intellectual property.
“We don’t have the luxury of not dealing with China. There are real complexities to the relationship, whether it’s the adversarial piece, whether it’s the competitive piece, whether it’s the co-operative piece,” Blinken said in the interview. “[Although China was acting like] someone who’s trying to compete unfairly and increasingly in adversarial ways… we’re much more effective and stronger when we’re bringing like-minded and similarly aggrieved countries together to say to Beijing: ‘This can’t stand, and it won’t stand’,” he said.
Prakash Gogoi contributed to this report.