The Department of Justice reports that an importer and two of its executives have been sentenced for avoiding the payment of more than $8 million in customs duties on imported goods and running a scheme in which the company laundered money and failed to report on tax returns more than $17 million derived from cash transactions.
According to a DOJ press release, the company was fined $11.5 million, ordered to pay more than $15 million in restitution, and ordered to submit to federal monitoring. The company’s president was sentenced to 103 months in federal prison, fined $8 million, and ordered to pay more than $19 million in restitution. Another of the company’s officers was sentenced to 84 months in federal prison, fined $500,000, and ordered to pay restitution.
DOJ states that the defendants avoided customs duties and tariffs by purchasing goods from overseas manufacturers but then submitting false information to U.S. Customs and Border Protection that understated the true value of the imported items. Overall the company imported goods that were undervalued by more than $51 million, resulting in approximately $8.4 million in unpaid tariffs and duties.
All three defendants were found guilty of three counts of entry of falsely classified goods, three counts of entry of goods by means of false statements, and three counts of passing false and fraudulent papers through a customhouse.
DOJ notes that the company also received U.S. currency in bulk cash that was derived from drug trafficking as payment for customer invoices. Those funds were delivered to the company by money couriers unrelated to and unknown to the company or the customers whose invoices were being paid. The company failed to file currency transaction reports, which are required for any transaction involving more than $10,000 in cash, and concealed the cash receipts from an accountant who prepared its taxes, which led to the fraudulent omission of more than $17 million in gross sales from tax returns filed with the IRS.
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