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US investigates allegations of Dell computer resales into Syria

US investigates allegations of Dell computer resales into Syria

Dell's standard contract prohibits distributors from reselling products to any sanctioned country, the company said

The U.S. Department of Justice (DOJ) is investigating a report alleging that Dell computers have been sold to the Syrian regime despite the trade embargo in place, according to a July filing by Dell to the U.S. Securities and Exchange Commission (SEC) that was made public this week.

The investigation was prompted by a New York Times report on May 3 that Dell computers were being sold to the Syrian government through a Dubai-based distributor.

Also on May 3, Dell received a subpoena from the U.S. Department of Commerce, Bureau of Industry and Security, seeking documents for sales, exports, and services for exports to BDL, a Dell distributor in Dubai, the company said in the filing. That bureau subsequently referred the matter to the DOJ, Dell said in the July 2 filing.

Dell's correspondence with the SEC was only made public Monday, a Dell spokeswoman said in an email on Tuesday. The SEC had asked Dell to address the extent to which the sales described in the Times article represent a liability under U.S. sanctions or export laws.

Dell is cooperating with the investigation and has been in regular communication with the Assistant U.S. Attorney handling the matter, it said in the letter. It is also conducting an internal investigation into the matter with the assistance of outside counsel, it said, adding that Dell is reviewing documents, collecting information and interviewing employees as part of its investigation.

A standard contract prohibits Dell distributors from reselling products to any sanctioned country, Dell said, adding that BDL has signed such a contract. Business with BDL was suspended pending the outcome of the investigation, Dell said. It continues to work with two other distributors in the United Arab Emirates, it added.

Until the governmental inquiries and internal investigation are closed, Dell is unable to determine whether, or to what extent, it will be subject to any liability under U.S. sanctions or export laws, it wrote to the SEC.

"Dell continues to cooperate with the government as the investigation is ongoing," the spokeswoman said in an emailed statement on Tuesday.

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