Subscribe free to our newsletters via your
. Military Space News .

Top Israeli arms firm fined for exports
by Staff Writers
Tel Aviv, Israel (UPI) May 21, 2012

Israel Aerospace Industries, flagship of Israel's defense industry, has been fined $260,800 for negotiating to export military equipment to an unidentified country without obtaining Defense Ministry approval.

The unusual action, reported by the liberal daily Haaretz Monday, took place in 2011, but the disclosure was the latest episode in a recent campaign to clean up Israel's arms trade that has put the industry under increased scrutiny.

The fine was imposed by the ministry's Department of Defense Export Controls, which conducted 161 investigations. The fine imposed in IAI was one of 13 instances where it took disciplinary action in 2011.

The type of equipment involved was not disclosed.

Five other cases are currently under investigation, Haaertz reported, without providing any details or naming the companies concerned.

The daily said that so far this year the department has examined 67 transactions involving military equipment for possible export violations.

"They tried to out the cart before the horse and went ahead without a permit and for that received a relatively harsh punishment," the newspaper quoted a senior defense source as saying.

He said state-owned IAI, which builds advanced unmanned aerial vehicles and Arrow interceptor missiles designed to shoot down ballistic missiles, complained that the fine was "disproportionately severe," but paid the fine in full.

The ministry's exports control division disclosed in April that in 2011 it awarded more than 8,000 export licenses to Israeli defense companies selling to 130 countries.

The disclosure about IAI came two weeks after the industry, a key exporting sector, was thrown into disarray by a government report that accused the ministry's director-general of approving exports deals involving weapons systems that the Foreign Ministry opposed.

The May 1 report by State Comptroller Micha Lindenstrauss heightened public scrutiny of the Defense Ministry, which, unlike other government departments, has long operated with great autonomy and with minimal accountability given the sensitivity surrounding national security in Israel.

Defense exports are vital to Israel's economy. In 2010, these totaled $7.6 billion, with the Israeli military buying another $2.4 billion worth. Exports in 2009 were $6.9 billion.

Four companies accounted for most of the 2010 total: IAI, Elbit Systems, Rafael Advanced Defense Systems and Israel Military Industries.

For many years, it has long been understood in Israel that the ministry, and particularly its export division, have been involved in dubious arms sales to unsavory regimes through shady weapons dealers licensed by the ministry.

Lindenstrauss' report did not directly address that issue, but it concluded the Defense Ministry's director-general, Udi Shani, violated defense export laws by approving several deals without consulting other departments.

Lindenstrauss also said Shani arbitrarily changed the ministry's policy in 2010 on how it provides export licenses to companies selling their products overseas.

On May 3, the government's quality watchdog agency, Ometz, called on Defense Minister Ehud Barak to suspend Shani immediately in light of Lindenstrauss' report until Attorney-General Yehuda Weinstein rules on whether Shani can continue as director-general at the ministry.

Shani, has been director-general at the Defense Ministry since 2010. He's been seen as a possible CEO of IAI later this year.

Lindenstrauss said that in at least three cases Shani had ignored export procedures and approved export licenses to companies to sell "military platforms" abroad even though the Foreign Ministry opposed them.

"The director-general and head of the Defense Ministry export agency overstepped their authority and acted against the law," Lindenstrauss noted.

He did not identify the weapons systems, their manufacturers or the intended buyers.

On March 8, India's Defense Ministry blacklisted state-owned IMI, along with five Indian and foreign companies, for 10 years over a 2009 bribery scandal. IMI denies any wrongdoing.

India is a one of Israel's major arms customers and that ban could have an impact on defense exports.

Israel's Defense Ministry has since ordered all defense companies to sign onto a "compliance program" to eradicate corruption in defense deals.

But all the evidence indicates the ministry keeps its registered arms dealers, who are invariably former officers, on a remarkably loose leash.

Yossi Melman, an Israeli journalist who specializes in intelligence and military affairs, observes that shady arms deals proliferate because "Israel is a small country based on an old boy network and there's insufficient supervision of the system … You can't supervise arms deals if you're promoting them."


Related Links
The Military Industrial Complex at
Learn about the Superpowers of the 21st Century at

Comment on this article via your Facebook, Yahoo, AOL, Hotmail login.

Share this article via these popular social media networks DiggDigg RedditReddit GoogleGoogle

Memory Foam Mattress Review
Newsletters :: SpaceDaily :: SpaceWar :: TerraDaily :: Energy Daily
XML Feeds :: Space News :: Earth News :: War News :: Solar Energy News

NATO moves to share costs of military hardware
Chicago (AFP) May 20, 2012
NATO on Sunday approved more than 20 joint projects designed to share the costs of weapons and equipment at a time when member states face shrinking defense budgets. Here are the highlights of the alliance's "smart defense" initiative presented at the NATO summit in Chicago: ROBOTS FOR ROUTE CLEARING Led by Italy, a group of NATO members will fund remotely-controlled robots used to c ... read more

NATO activates missile shield, reaches out to Russia

NATO activates missile shield despite Russian anger

Lockheed Martin's Second Generation Aegis BMD System Successfully Intercepts Missile

U.S. aids Israel missile, seeks joint deal

S. Korea 'to spend $2 bn' on hundreds of missiles

Raytheon awarded $313.8 million for Standard Missile-6 all-up rounds

Training missile falls from Army chopper in Texas: US

Lockheed Martin's New Standalone Launching System Significantly Reduces Weapons Integration Costs

Russia 'may buy' $50 mln worth of Israeli UAVs

3D MAW (FWD) explores the use of unmanned helicopters

GE Aviation to Participate in Demo on AAI's Shadow UAS

Autonomous Vehicle Developed for Surveying Assault-Zone Runways

Second AEHF Military Communications Satellite Launched

Fourth Boeing-built WGS Satellite Accepted by USAF

Raytheon to Continue Supporting Coalition Forces' Information-Sharing Computer Network

Northrop Grumman Wins Contract for USAF Command and Control Modernization Program

Raytheon awarded $57.8 million Phalanx contract

ARL-led program enables new manufacturing processes for ballistic protection

Research findings show brain injury to soldiers can arise from exposure to a single explosion

India ready for U.S. howitzer purchase

Chinese fake parts 'flood' US military: Senate report

NATO moves to share costs of military hardware

Top Israeli arms firm fined for exports

Northrop Grumman to Explore Opportunities with Brazilian Machining Companies

Walker's World: The G8 flunks the test

China TV host sparks debate with 'foreign trash' tirade

China pursuing steady military build-up: Pentagon

Rookie Hollande takes flight at US summits

New technique uses electrons to map nanoparticle atomic structures

Light touch keeps a grip on delicate nanoparticles

Next-Generation Nanoelectronics: A Decade of Progress, Coming Advances

Nanotech gets boost from nanowire decorations

The content herein, unless otherwise known to be public domain, are Copyright 1995-2014 - Space Media Network. AFP, UPI and IANS news wire stories are copyright Agence France-Presse, United Press International and Indo-Asia News Service. ESA Portal Reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by Space Media Network on any Web page published or hosted by Space Media Network. Privacy Statement