Hong Kong and U.S. authorities share 20.5 million dollars for smuggling scheme

Both U.S. and Hong Kong authorities were recently caught in an intricate fraud plan involving Chinese-made apparel. The scheme involves smuggling the apparel for over fifteen years, which results in a total of 20.5 million dollars in forfeited assets.

The smuggling started in 2000, where Chinese-made apparel was brought into the U.S. through Los Angeles and Long Beach ports. U.S. customs had launched an investigation that year into this multinational criminal organization, according to Apparel News. Recently, the assets were seized leaving both the U.S. and Hong Kong authorities responsible for more than 7,000 shipping containers filled with clothing. As reported by WWD, the fraud scheme involved coordinating with the Hong Kong Special Administrative Region, which involved smuggling more than 6000 million dollars worth of apparel into the U.S.

The smugglers involved with the criminal act provided fake documents to customs brokers so that they wouldn’t have to pay duties. As reported by Apparel News, the garments were claimed to be sold to companies in Mexico instead of delivered to the U.S. The investigation showed that the garments were transferred by truck to U.S. manufacturers instead of continuing towards Mexico. The entire process costs U.S. customs approximately 60 million dollars in customs revenues.

Hong Kong and U.S. authorities under fire for smuggling deal

“This payout has been a long time coming, but it’s a testament to the perseverance of the personnel on two continents who were involved in dismantling this scheme,” said Joseph Macias, special agent in charge for HSI Los Angeles. In total, the seizure included over 200 cargo containers of apparel, business locations, and also a 100,000 square foot warehouse in Commerce, Calif.

Currently, there are five people that are allegedly suspected for being responsible for the scheme. Armando Salcedo, owner of Friends Global Logistics trucking company pleaded guilty to smuggling in 2008, according to WWD. However, there are four other involved persons that currently are not yet in custody.

 

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