U.S. Customs and Border Protection ("U.S. Customs") and the Department of Justice have stepped up prosecution of fraud committed to avoid the payment of antidumping duties. In March 2011, the Department of Justice indicted the owner of a Baltimore-based importer for allegedly making false claims on entry documents. Multi-million dollar forfeitures and fines are possible. In late 2010, owners of a Chicago-area importer accepted a plea agreement that included imprisonment, a six-figure forfeiture, and confiscation of goods. The defendants submitted false invoices to avoid cash deposits and obstructed U.S. Customs' investigation. Also in late 2010, U.S. Customs seized goods valued at nearly $500,000 after discovering that the entries violated antidumping duty laws. After the Baltimore indictment, Baltimore Port Director Ricardo Scheller stated, "These charges acknowledge the serious impact dumping has on competitiveness of American industry and our nation's economic vitality. CBP [U.S. Customs] is committed to working closely with ICE [Immigration and Customs Enforcement] and the U.S. Attorney's Office to bring future antidumping violators to justice."
Criminal investigations concerning the failure to pay antidumping duties generally focus on the importer's submission of false entry documents and commercial invoices, and the making of false claims concerning the quantity, value, physical description, and/or country of origin of goods. The maximum statutory penalties include five years imprisonment and fines of $250,000, or twice the resulting gross gain or loss, whichever is greater. Additional prison time and fines can arise where related crimes are prosecuted.
In the Baltimore indictment, Jin Qing Huang, owner of Woncity, Inc. ("Woncity"), was arrested for defrauding U.S. Customs and failing to pay antidumping duties on imported goods. Huang and Woncity were indicted for conspiracy, smuggling, making false statements, and false classification of goods. They allegedly conspired to avoid payment of $1,150,000 in antidumping duties. Huang was held pending a detention hearing. The indictment seeks forfeiture of lost duties plus a maximum fine of $250,000 per count. Huang also faces sentences of five years for conspiracy, 20 years each on three smuggling counts, and two years each on six false entries/false classifications counts.
The Chicago plea agreement involved owners of S&P Plastics, Inc. Executives Young Seung Shin and Peili Ding tendered false invoices and falsely declared entries were not subject to an antidumping duty order in order to avoid payment of cash deposits. They also obstructed justice by destroying records and tendering altered records. Shin and Ding received prison terms, must forfeit $182,871 for lost duties, and goods were seized.
Finally, after discovering a scheme to circumvent an antidumping duty order on bags from China, in late December 2010 U.S. Customs agents in Los Angeles seized goods with an estimated U.S. value near $500,000. The importer used false invoices to conceal the goods.