A massive shipment of apparel from Hong Kong was seized for being illegally imported into the US. Commercial smuggling has greatly impacted US importation revenues and enforcement efforts have increased to try to stop undermining the US economy. The scheme involved false documents to customs that were fabricated to avoid import duties and quotas. Estimated losses in revenue are in excess of $600 million.
The documents claimed that the goods were being sold to companies in Mexico. In fact, they were to be distributed to customers in the United States. An owner of a Los Angeles based trucking company was federally charged in connection with this case and pled guilty in 2008. There are four other defendants that remain at large for making false customs declarations and smuggling.
US Title 18 Section 545 prohibits smuggling of goods that should have been declared at customs. It also penalizes conduct for fabricating documents in connection with bringing in the smuggled goods. The specific intent element of the crime is “knowingly” or fraudulently. It must be proven that the defendant knew the object was intended for export contrary to the laws of the United States.
Although the maximum term of imprisonment on this count may be 10 years, there may be additional sentencing enhancements based on the type, value and amount of the goods and fines typically range in the millions. Furthermore, the products can be permanently seized and confiscated by the government.
Collaboration among enforcement agencies such as ICE (Immigration and Customs Enforcement), Customs and Border Patrol, Homeland Security Investigations, and the US Coast Guard have led to zealous enforcement. In this particular case, these agencies seized over $20.5 million in assets. Some of the seizures included 100,000 square foot warehouses in Commerce and other businesses in Los Angeles and Texas.
There is an entire asset forfeiture branch of ICE that is dedicated to finding assets that are the proceeds of the smuggling or were used to facilitate breaking the federal smuggling laws. Their primary goal is to deter criminals from profiting from the property used in connection with the crime. Once seized, the property is equitably shared with other local branches of government and internationally to facilitate law enforcement cooperation.
There has been noted asset forfeiture abuse and defense attorneys at the Blanch Law Firm are committed to fighting inequitable or illegal asset forfeiture actions. The government can seize a person’s property without notice or hearing by moving ex parte by merely showing probable cause that the property was involved in a crime. The property itself does not have to be illegal, it could be the proceeds of a crime or somehow facilitates the crime. The property may even end up in the hands of someone not even alleged to be connected to the criminal activity. How broad is this reading of what constitutes the instruments or proceeds of a crime?
The government’s ability to extract fines is limited by the Excessive Fine Clause. In certain instances, an excessive fine or forfeiture violates the 8th Amendment. Indeed the forfeiture must be proportionate to the gravity of the offense. See United States v. Bajakajian, 524 U.S. 321 (1998) (failure to declare currency in excess of $10,000 did not justify forfeiture of $357,000 in cash that an international passenger was caught by Customs with when departing the US).
In fact, since that case there have been subcommittees established for oversight of federal asset forfeiture which can be administrative, civil or criminal. Limitations set by the federal government and arguments made by attorneys can help regulate and ensure that property seizures remain equitable and not excessive or illegal under the laws.