January 2011

Is Your Company Under Investigation by the Federal Government?

Every year, the numerous agencies of the United States Government send out letters to companies putting them on notice that the company is suspected of committing some serious violation.  Usually, the letter or notice demands a written response within 30 days or the company will be subject to a penalty or fine.  Knowing how to handle such letters, notices, or subpoenas is critical in terminating the investigation successfully, not paying a huge penalty, and even avoiding criminal prosecution.

The Executive Branch departments, bureaus, and agencies of the Federal Government  all have the legal authority to investigate and assess penalties against companies that violate that particular Government agency’s regulations. This is especially true of companies which are importers, exporters, or otherwise involved in international trade such as customs brokers, international freight forwarders, airlines, and indirect air carriers.  The U.S. Food and Drug Administration (FDA) would issue an “Administrative Subpoena” or a”Notice of FDA Action”, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) would issue an “Administrative Subpoena” while the U.S. Department of Transportation’s Federal Aviation Administration (FAA) would call it a “Notice of Proposed Civil Penalty”, the U.S. Department of Homeland Security’s Customs and Border Protection (CBP) describes it as a “Notice of Action” and “Pre-Penalty Notice”, the Environmental Protection Agency (EPA) calls it a “Request for Information”, the U.S. Commerce Department’s Bureau of Industry and Security (BIS) calls it a “Proposed Charging Letter”, and the Transportation Security Administration (TSA) would call it a “Letter of investigation”.

Whatever pseudonym or term is used, the Government documents are all similar in […]

By |2015-12-28T14:17:59-05:00January 19, 2011|Import, Investigation|0 Comments

Bank Accounts and Seizure Warrants

The U.S. Department of Homeland Security’s Immigration and Customs Enforcement (ICE) is seizing a record number of bank accounts for money laundering.  In summary, here is how it works.  A Special Agent from ICE submits an Affidavit to a Federal Judge, the Judge signs a Seizure Warrant authoring the Special Agent to serve that document upon the bank to seize whatever money is in that account.  Although the seizure of such accounts may accomplish a legitimate law enforcement purpose in attempting to stop the illicit sale of narcotics by taking the money generated from those sales, the process is too easily abused by the U.S. Government.

The Affidavit filed by the Special Agent is usually “sealed” which means it will not be available to the public or even the person or company for which the bank account monies were seized. Due process should allow a claimant prompt access to that information so the account holder may meaningfully challenge the seizure in Federal Court.  At a minimum, the Seizure Warrant should specify what the facts were that supported an allegation of money laundering. Right now, the standard language in the Seizure Warrant only states:

The bank account is subject to seizure and grounds exist for the issuance of this seizure warrant pursuant to 18 U.S.C. 981(a)(1(A) and 21 U.S.C. 881.

That’s it; that’s all you get from the U.S. Government as the reasons that your entire bank account has now been cleaned out, potentially leaving a company unable to pay its bills, including to its employees, or […]

Free Trade Agreements: Good or Bad?

I am still troubled by the Wall Street Journal lead article on October 4, 2010 with the headline “Recession-Weary Americans Sour on Free Trade.”  I asked myself why would Americans who live in an economy built successfully on the principles of capitalism and free enterprise be against international trade?  The WSJ article stated that a poll concluded that 53% of Americans said free trade hurt, rather than helped, the U.S. economy, a statistic that increased from 46% in 2007 and 32% in 1999.  My bold prediction is that 2011 will be the year that the Obama Administration successfully finalizes free trade agreements with South Korea, Panama, and Colombia, and then Congress passes laws approving them.

Americans sometimes want their cake and eat it too. They want American companies to make and export more airplanes, more tractors, and more wheat and corn, all the while shopping at their local department stores and buying merchandise made in, and exported from, China, Indonesia, and Mexico.   As stated in the WSJ by my law school friend Myron Brilliant, Senior Vice President at the U.S. Chamber of Commerce:

When we knock down [trade] barriers in those [foreign] markets, we create jobs here [in the United States]. We’ve got to trade to create jobs in our country.

Boeing employs tens of thousands of employees in the United States to produce airplanes to sell overseas.  American farmers grow wheat and corn in amounts far beyond what could be consumed in the United States.  Caterpillar sells more tractor equipment overseas than it does in the United States. According to […]

Title

Go to Top