Indictment Issued in Air Parts Smuggling

A federal grand jury in Los Angeles accused Yugoslav Airlines of conspiring with an Irvine company and its president to smuggle aircraft parts and supplies into Yugoslavia in the early 1990s in violation of a U.S. trade embargo.

A 40-count indictment unsealed Friday accuses Yugoslav Airlines, Yugoslavia’s largest carrier, exporter D.C. Precision and its president, Dusko Cavic, of smuggling $1.4 million worth of parts into Yugoslavia via Switzerland.

Cavic, 47, of Tustin, was arrested by federal agents Friday morning, a spokesman for the U.S. attorney’s office said.

The defendants are accused of violating a trade embargo imposed from 1992 to 1995 in response to Serbian aggression in Bosnia. The U.S. sanctions were imposed alongside a United Nations embargo that banned the export of a wide range of goods and technologies.

Messages left at D.C. Precision’s headquarters and with Cavic’s attorney were not immediately returned. Yugoslav Airlines offices in the United States were closed because of an embargo imposed by the European Union, according to the airline’s Web site.

The indictment is part of a continuing probe of possible embargo violations by U.S. companies, said Assistant U.S. Atty. Joseph O. Johns.

“The reality is that the imposition of economic sanctions is an important tool of U.S. foreign policy and the resolution of armed conflicts,” Johns said. “Sanctions are only effective if the target suffers the effect of the sanction.”

D.C. Precision purchased aircraft parts and oil from U.S. makers and resold the supplies to Yugoslav Airlines, sometimes through a front company, Federal Marketing Syndication, that the airline established in Athens, Johns said..

There is no indication that any of the parts or supplies were diverted for military use, he said.