An IBM subsidiary pleaded guilty Friday to illegally exporting 17 advanced computers to a Russian nuclear weapons laboratory and agreed to pay an $8.5 million fine, in what federal investigators believe is the first criminal conviction against IBM.
Russia secretly bought the computers in late 1996 and early 1997 in the mistaken belief that Washington would approve the purchase after Moscow signed a total ban on nuclear tests, long advocated by the United States.The computers can improve Russia's ability to simulate nuclear weapons testing. The sale of any computer to a Russian nuclear weapons facility requires federal approval, which IBM never received.
After an 18-month investigation, IBM's Moscow subsidiary, IBM East Europe/Asia Ltd., pleaded guilty to 17 felony violations of the export control laws in U.S. District Court in Washington.
There was no evidence that IBM's American executives were aware of the illegal shipments, which involved a series of Russian middleman and circuitous shipping arrangements in Europe.
"IBM acted in a highly responsible manner" by cooperating with the government, said Assistant U.S. Attorney Eric Dubelier, who prosecuted the case.
Rob Wilson, an IBM spokesman, said: "We regret the involvement of our Russian subsidiary in this case. IBM will not tolerate any violation of its standards of business conduct."