Three government agencies, including the military, purchased video surveillance equipment from Lorex, which is a wholly owned subsidiary of a company that is banned from selling technology in the United States, according to Tech Crunch.
Dahua Technology, one of several Chinese companies that have been banned from selling technology to the United States government under a new rule in 2019 due to fears that the Chinese government could use transactions to conduct espionage.
In 2019, Dahua was added to the federal economic trade restriction list due to the company being linked to efforts by the Chinese government to suppress the Uighur population in China's Xinjiang region.
The records obtained by TechCrunch show that federal agencies spent thousands of dollars on Lorex's video surveillance equipment, including the Drug Enforcement Agency, which bought nine Lorex hard drives in May through a Washington, D.C. tech supplier.
A DEA spokesman told TechCrunch that purchases were made through the General Services Administration but did not confirm whether Lorex products had been pulled from the GSA's government shopping portal.
GSA has multiple ways to vet vendors and products sold on GSA Advantage in accordance with the Federal Acquisition Regulations FAR GSA said in a statement to Tech Crunch. The clauses and provisions in the FAR require contractors to state whether they sell covered technology. Products that are non-compliant are removed from GSA Advantage. Records show that the Department of the Army and the Defense Finance and Accounting Service of the Department of Defense purchased Lorex equipment.
The Army told Tech Crunch that the contractors are responsible for making sure the equipment is from a legitimate company.
The Department of Defense enacted the prohibitions for Section 889 of the National Defense Authorization Act for Fiscal Year 2019 and Public Law 115-232 on August 13, 2020. Companies that propose on federal contracts are required to assert their compliance with various Federal Acquisition Regulation and Defense supplement provisions and clauses, including those required by P.L. 115 232 is on the System for Award Management website. The title 18 of the United States Code, or civil liability under the False Claims Act, is applicable if a company misrepresents itself, said Army spokesperson Lt. Col. Brandon Kelley.
A Democratic spokesman for the House Armed Services Committee is calling for the Department of Defense to take appropriate action. In a statement, Monica Matoush said that the Department of Defense will take appropriate action to investigate these reports and take action to mitigate harm and prevent future problems. The Department of Defense didn't respond immediately to a request for comment from Fox Business.