Tracking Trade Bad Guys

Dec. 21, 2004
Even more important after Sept. 11, software and management services offer international traders ways to screen customers.

You may have never heard of the U.S. denied parties list, which, contrary to what the name suggests, has nothing to do with being banned from swanky social events. However, if trade is part of your company's strategic game, and you're an American CEO who doesn't want to serve jail time, you can't afford to ignore who's on -- and who is not on -- the list. The list -- actually it's more than half a dozen lists -- consists of people and companies that the U.S. Commerce Department, Treasury Department and State Department don't want you doing business with. The objects of their non-affection are baddies such as terrorists, narcotics smugglers and foreign firms that might do nasty things with nuclear material. Needless to say, these lists have taken on additional significance since last year's Sept. 11 attacks. Manufacturers and other U.S. companies confront a major challenge in keeping current with the lists. The federal agencies that compile them can update the lists as often as three times a day, notes Darren Maynard, COO of NextLinx Corp., a Rockville, Md.-based provider of software solutions for international trade management. "We literally have staff checking the U.S. lists three times a day to make sure our tables are current and pushing those changes out to our customers," Maynard says. NextLinx' customers include Cisco Systems Inc., Fairchild Semiconductor International Inc. and 3Com Corp. High-tech firms, automakers, chemical producers, pharmaceutical companies, apparel makers and makers of consumer-packaged goods are among the manufacturers contacting his company these days and asking about customer screening, says Gregory E. Stock, vice president for marketing at Vastera Inc., a Dulles, Va., company that produces trade-related software and manages trade operations for such companies as Ford Motor Co., Dell Computer Corp., Microsoft Corp., Lucent Technologies Inc. and Ingersoll-Rand Co. "The amount of time it takes to sell [our management solutions] has gone down . . . because companies are coming in and saying, 'I need to do this now,'" Stock relates. "We do a lot more than just that screening piece, but right now that's the thing that seems to have companies really wanting to talk to us." Demand for Vastera's and NextLinx's technologies and services seems destined to increase. In addition to the U.S. lists, the United Nations has a restricted list, and the Europeans are assembling one. "We have to get those lists, bring them together into a single technology, and make it very easy for [manufacturers] to just take their orders and every second, every minute, every hour bounce them against the list to make sure they are not sending their goods to the wrong person," says Stock.

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