U.S. Department of Justice (DOJ)

ICYMI: Patio Furniture Company Agrees to Pay $4.9 Million to Resolve Duty Evasion Allegations

On July 24, 2025, the Department of Justice (DoJ) announced that Grosfillex, Inc., a Pennsylvania furniture company, agreed to pay $4.9 million to resolve allegations it evaded antidumping and countervailing duties (AD/CVD).

Grosfillex submitted false forms to Customs and Border Protection (CBP) claiming that furniture parts made of extruded aluminum from China were not subject to AD/CVD. The company attempted to hide the aluminum extrusions by falsely packing them as sham “furniture kits.” Additionally, for a different subset of extrusions, the company failed to correct customs forms it had submitted previously, even after learning that the forms contained false information.

The investigation arose from a whistleblower lawsuit filed under the False Claims Act by a former employee of Grosfillex. Under the False Claims Act, private citizens can sue on behalf of the government and share in any recovery. In this case, the whistleblower will receive $962,662.74.

Duty Evasion is on the Rise

This case is just one example of the growing incentive to cheat that comes with higher tariffs. Whether it’s through misclassifying goods, undervaluing imports, or using deceptive transshipment routes, some companies think they are being creative, but, instead, are participating in outright illegal strategies to reduce their tariff liability.

Higher tariffs have even contributed to the emergence of a cottage industry of “tariff reduction” companies that suggest ways to cut import costs. However, many of these so-called strategies amount to evasion, […]

CIT Hands Down $3.4M Penalty for Duty Evasion

On July 18, 2025, the Court of International Trade (CIT) granted the government’s motion for default judgment against importer Rayson Global and its owner, Doris Cheng, for negligently failing to pay duties. 

The Case

The government’s case was filed in 2023, alleging that the importers had falsely declared that Chinese-origin goods as Thai origin to evade duties. The government asserted this false declaration avoided payment of ordinary 6% duties, Section 301 duties ranging from 10% to 25%, and 234.51% antidumping duties. 

The government asked the court to impose a penalty for negligence. The penalty amount is twice the loss of revenue or the domestic value, whichever is lower. After the importer failed to answer the complaint (a huge mistake), the U.S. moved for summary judgment.

The CIT granted the government’s motion and ordered the importer to pay a nearly $3.4 million penalty as well as all unpaid duties, taxes, and cash deposits on the unliquidated entries in question.

Duty Evasion is on the Rise

This case is just one example of the growing incentive to cheat that comes with higher tariffs. Whether it’s through misclassifying goods, undervaluing imports, or using deceptive transshipment routes, some companies are turning to creative or outright illegal strategies to reduce their tariff liability.

These incentives have even contributed to the emergence of a cottage industry of “tariff reduction” companies that suggest ways to cut import costs. However, many of these so-called strategies amount […]

ICYMI: USDA Plan Calls for Stronger Enforcement of Agricultural Imports

On July 8, 2025, the U.S. Department of Agriculture (USDA), along with the Department of Homeland Security (DHS), the Department of Justice (DoJ), and the Department of Defense (DoD), released a National Farm Security Action Plan to elevate American agriculture as a key element of the country’s national security. 

Plan Details

The action plan will enable USDA to work closely with governors, state legislators, and federal partners to further integrate agriculture into the broader national security efforts over the coming months and years.

The USDA and its government partners will take “aggressive action” across seven critical areas:

  1. Secure and Protect American Farmland – Address U.S. foreign farmland ownership from adversaries head-on. Total transparency. Tougher penalties.
  2. Enhance Agricultural Supply Chain Resilience – Refocus domestic investment into key manufacturing sectors and identify non-adversarial partners to work with when domestic production is not available. Plan for contingencies.
  3. Protect U.S. Nutrition Safety Net from Fraud and Foreign Exploitation – Billions have been stolen by foreign crime rings. That ends now.
  4. Defend Agricultural Research and Innovation – No more sweetheart deals or secret pacts with hostile nations. American ideas stay in America.
  5. Put America First in Every USDA Program – From farm loans to food safety, every program will reflect the America […]

Jennifer Diaz Featured in the Wall Street Journal

We are pleased to announce that DTL President Jennifer Diaz was recently featured in the Wall Street Journal!  

Reporter Corinne Ramey walks through the recent uptick in efforts to evade rising tariffs and how the federal government is responding. She quoted Jennifer on DTL’s approach to advising clients on enforcement. 

Below are a few snippets from the piece. Read the full article on the WSJ.com here. 

“First came President Trump’s announcements of sweeping tariffs. Next up, lawyers say, is the cheating. 

Trade lawyers say that as tariffs skyrocket, so too do the incentives not to pay them. Clients are inundating them with questions about the line between lawful loopholes and fraud. 

At the same time, the Justice Department’s shifting white-collar priorities to pursue tariff and customs-related cases more aggressively have helped create a perfect storm for more trade enforcement. And lawyers say they have seen a sharp increase in calls from whistleblowers looking to file their own cases about alleged wrongdoing…” 

“Jennifer Diaz, a Florida trade lawyer, said her firm was ramping up its criminal expertise to prepare for a new wave of enforcement. The firm now advises clients on regulatory matters and navigating customs rules.  

‘To have this topic being front page news on a daily basis is a trade lawyer’s dream,’ Diaz said.” 

Diaz Trade Law is […]

DOJ Targets Trade Fraud: Importers Now on Notice as Criminal Division Ramps Up Enforcement

On May 12, 2025, Matthew Galeotti, the Head of the U.S. Department of Justice’s Criminal Division, sent a memo to all criminal division personnel highlighting the focus areas of the division for white-collar crime.

The memo included a list of “high-impact areas” that the division will prioritize investigating and prosecuting. Trade and customs fraud, including tariff evasion, was second on the list.

The DOJ also revised its Corporate Whistleblower Awards Pilot Program and added “trade, tariff, and customs fraud by corporations” to the priority list.

Galeotti noted that unchecked fraud in U.S. markets robs hardworking Americans, harms the public, and that efficient enforcement promotes American economic and national security interests.

This memo signals a significant shift in the priorities of the DOJ’s criminal division. Historically, trade violations were not a top criminal priority and were instead handled by CBP and the DOJ’s Civil Division. Relatively few trade law violation cases have risen to the level of criminal prosecution.

What Importers Should Do

Now more than ever it is critical for importers to examine their import compliance programs and ensure that adequate procedures are in place to correctly enter goods into the United States.

Invest in Compliance

CBP expects importers to use “reasonable care” in reporting HTS, value, country of origin, free trade agreement preference, etc. This is a subjective standard; however, CBP […]

By |2025-06-13T13:24:14-04:00June 13, 2025|U.S. Department of Justice (DOJ)|0 Comments
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