Export control is an interesting field of law enforcement. Every case is international in nature, and often the targets include multinational corporations. As the scale of the company increases so do the number of transactions and their dollar value. Add to that the evergreen tradition of new administrations announcing a refocus on enforcement, which often includes a promise to hold executive management responsible for violative behavior in their remit, but rarely follow through. But at the Bureau of Industry & Security, where the focus of criminal enforcement traditionally involves global settlements and corporate monitorships rather than CEOs in handcuffs, a recent case bucks that trend.

In March the Justice Department announced the indictment of Yih-Shayn “Wally” Liaw, a co-founder, board member, and Senior Vice President at high performance server manufacturer Supermicro. Liaw and two associates: the manager of Supermicro’s Taiwan office and a contractor are charged with conspiracy to illicitly divert US origin servers containing Nvidia’s advanced semiconductors to China. The indictment paints a vivid picture of Liaw’s alleged actions and knowledge. He has pled not guilty and is currently free on a $5 million bond. In these cases, one would normally expect to see a charge against the company as well. However, neither Supermicro, nor Nvidia, appear as defendants; in fact, while Nvidia is name-checked in the opening paragraph, references to Supermicro in the indictment identify them only as ‘Company-1.”

In a press release issued shortly after the indictments were unsealed, Supermicro announced that they were cooperating fully with the investigation, putting the employees on administrative leave, and terminating the contractor. They also reiterated their commitment to export compliance: touting their robust internal compliance program. A follow-up release announced the resignation of Liaw from the Board of Directors, and the appointment of an acting Chief Compliance Officer. Nvidia offered a similar statement, reiterating the importance of compliance and cooperation with the government and their customers to ensure export controls are adhered to.

Every new administration brings new political appointees in the executive branch and new priorities for the departments and agencies. And while both the Justice Department and the Bureau of Industry and Security have vowed to charge C-Suite corporate officers when the evidence supports it, most export control investigations involving multinational scale companies end in global settlements and corporate pleas without an executive in custody. This case flips that script: we see three individuals charged with federal felonies, but no corporate charges announced.

While it is too early to tell if this is a trend, it should grab the attention of executives at companies with export compliance risk. This indictment is both good news and bad news for corporate leadership: the good news is that a company with a robust compliance program who cooperates in an investigation can hope for similar treatment. The bad news? Well, if you are on the board and in the conspiracy, it can be summed up by a lyric from the theme to “Baretta,” a detective show of the 1970s: “Don’t do the crime if you can’t do the time.”