BUSI 465-D01
Case Study 1: Skyway
BUSI 465-D01
Liberty University
Detailed
Report
The Skyway company is a distributer of aircraft spare parts that’s located in
Connecticut with a focus on a salesperson name Debra Bright. Debra received a fax for a
potential new client that was based in Paris, France. The products that the client wanted to buy
was considered “dual- use” which meant they are subject to export regulations from the
Commerce Control Lists. The products ended up being seized by Exodus and Skyway was
penalized $35,000 and denied
export privileges for one year. Debra failed to follow the necessary export compliance
procedures and recognize the red flags that were shown with her conversation with the
client.
The first thing Debra failed to do was documenting the order properly with the
necessary information. When a member of the Bureau of Industry and Security (BIS)
confronted the Skyway senior manager and requested full documentation of the order with the
client from France, all they had was Debra’s fax that was sent and received from Monsieur
Gaspar. This occurred because the buyer was in a rush to receive the products, which Debra
allowed by skipping some important steps of documentation. The two main reasons why Debra
allowed the process to be sped up is because it was her biggest order at the company, and she
was scheduled to leave for vacation the following day. The other reasons included a sale of this
size would give her a significant increase in a bonus and wanted to please her client so she
wouldn’t lose the sale.
The reasons provided above are not justified for Debra to not produce the necessary
documentation that was required by the CCL. Anytime the products were shipped off, there
, was a chance the BIS could have requested the documentation anyway, which would have
caused the penalty. The company could have still been penalized and put Debra’s job, and the
company, at risk for losing their exporting license. Even if it put in jeopardy the relation with
the client from France, the deal should have still been fully documented. Debra should have
known the risk she was putting herself into and should have followed procedure. The
company’s penalty could have been even higher (KU Export, 2015).
The second thing Debra failed to do report on the red flags that the client was giving
off and to screen the client to see if they were a legitimate buyer and not a risk for being a
denied person. Prior to Debra processing the order, she should have ensured full compliance
with all terms and conditions of the Federal Register and check the client on the websites of
the Department of Commerce, State, and Treasury (Export, 2019). In other words, Debra
should have screened her client for any restrictions and proof of legitimacy before going
through with the order to protect herself and the company from losing their export license.
Screening is not the only thing Debra decline to impose on the client that ended up in
her leave from the company. The other step was failing to realize the clear red flags that the
client from France was giving off and should have raised suspicion about the customer. The
BIS has a clear checklist that is supposed to help exporters be on the lookout for when
discussing an order. A few of the red flags that the BIS points out that Debra failed to realize
are “Customer willing
to pay cash for a very expensive item, customer declined training and installation of the
product, and a freight forwarding firm is listed as the final destination” (Gross). All of these
instances occurred with the discussion of Debra and her client in France, but Debra decided to
process the order anyway. These indicators should have been reported to the senior managers
for further investigation into the client for safety and concern reasons.
Lastly, Debra should have requested a signed end-use statement from the client and
should have done this prior to shipment. When the BIS representative came to Skyway to
Case Study 1: Skyway
BUSI 465-D01
Liberty University
Detailed
Report
The Skyway company is a distributer of aircraft spare parts that’s located in
Connecticut with a focus on a salesperson name Debra Bright. Debra received a fax for a
potential new client that was based in Paris, France. The products that the client wanted to buy
was considered “dual- use” which meant they are subject to export regulations from the
Commerce Control Lists. The products ended up being seized by Exodus and Skyway was
penalized $35,000 and denied
export privileges for one year. Debra failed to follow the necessary export compliance
procedures and recognize the red flags that were shown with her conversation with the
client.
The first thing Debra failed to do was documenting the order properly with the
necessary information. When a member of the Bureau of Industry and Security (BIS)
confronted the Skyway senior manager and requested full documentation of the order with the
client from France, all they had was Debra’s fax that was sent and received from Monsieur
Gaspar. This occurred because the buyer was in a rush to receive the products, which Debra
allowed by skipping some important steps of documentation. The two main reasons why Debra
allowed the process to be sped up is because it was her biggest order at the company, and she
was scheduled to leave for vacation the following day. The other reasons included a sale of this
size would give her a significant increase in a bonus and wanted to please her client so she
wouldn’t lose the sale.
The reasons provided above are not justified for Debra to not produce the necessary
documentation that was required by the CCL. Anytime the products were shipped off, there
, was a chance the BIS could have requested the documentation anyway, which would have
caused the penalty. The company could have still been penalized and put Debra’s job, and the
company, at risk for losing their exporting license. Even if it put in jeopardy the relation with
the client from France, the deal should have still been fully documented. Debra should have
known the risk she was putting herself into and should have followed procedure. The
company’s penalty could have been even higher (KU Export, 2015).
The second thing Debra failed to do report on the red flags that the client was giving
off and to screen the client to see if they were a legitimate buyer and not a risk for being a
denied person. Prior to Debra processing the order, she should have ensured full compliance
with all terms and conditions of the Federal Register and check the client on the websites of
the Department of Commerce, State, and Treasury (Export, 2019). In other words, Debra
should have screened her client for any restrictions and proof of legitimacy before going
through with the order to protect herself and the company from losing their export license.
Screening is not the only thing Debra decline to impose on the client that ended up in
her leave from the company. The other step was failing to realize the clear red flags that the
client from France was giving off and should have raised suspicion about the customer. The
BIS has a clear checklist that is supposed to help exporters be on the lookout for when
discussing an order. A few of the red flags that the BIS points out that Debra failed to realize
are “Customer willing
to pay cash for a very expensive item, customer declined training and installation of the
product, and a freight forwarding firm is listed as the final destination” (Gross). All of these
instances occurred with the discussion of Debra and her client in France, but Debra decided to
process the order anyway. These indicators should have been reported to the senior managers
for further investigation into the client for safety and concern reasons.
Lastly, Debra should have requested a signed end-use statement from the client and
should have done this prior to shipment. When the BIS representative came to Skyway to
