LinkedInFacebookInstagramXYouTube
305-456-3830|info@diaztradelaw.com

Enforcement

Call 305-456-3830 or email info@diaztradelaw.com.

New Executive Order on Strengthening Customs Enforcement

On June 3, 2026, President Trump signed the Executive Order “Strengthening Customs Enforcement,” directing the Department of Homeland Security (DHS) and U.S. Customs and Border Protection (CBP) to overhaul the rules that govern importers of record (IORs). The accompanying White House Fact Sheet frames the Order as a truly significant tightening of importer responsibilities – higher bonds, mandatory domestic assets, a new “good standing” requirement on all importers, and sharp new limits on foreign IORs. As CBP put it in its announcement, importing into the United States “has for too long been treated as a right and not a privilege.” While the Order has set aggressive deadlines for Customs reforms, it leaves most of the operational details to future rulemaking, and several of those details could reshape day-to-day compliance.  

Overview: What the Executive Order Directs 

Within 180 days, the Order requires the Secretary of Homeland Security to revise importer eligibility rules under 19 U.S.C. § 1484, § 1498, and § 1623, among other authorities. The most notable changes for IORs will be: 

  • A requirement that every IOR maintain, at all times, a minimum level of tangible domestic assets, bonding, or both — plus an increase in the minimum required bond coverage. 
  • Expanded data and identification requirements, including anticipated import volumes, year organized, ownership and beneficial ownership disclosures, business affiliations, and […]
By |2026-06-08T19:30:30-04:00June 4, 2026|Enforcement, U.S. Customs and Border Protection (CBP)|0 Comments
Read More

Three Enforcement Actions, One Message: Trade Violations Are Serious Crimes 

Learn more about this topic in our upcoming webinar: From Error to Action: Filing a Prior Disclosure with CBP 

As tariffs climb and global trade becomes more complex, a growing number of importers are testing the limits, or outright breaking the law, to reduce or avoid duty payments and other compliance costs. U.S. enforcement agencies, including Customs and Border Protection (CBP) and the Department of Justice (DOJ), have made it clear that customs fraud will not be tolerated and is a top enforcement priority. Three recent cases illustrate the new reality for enforcement. 

1. Undervaluation and the False Claims Act: $2.1 Million Settlement

An importer of fitness equipment agreed to pay $2.1 million to resolve allegations under the False Claims Act that it knowingly undervalued imported goods. 

According to the government, the company knowingly declared artificially low values on its imports in order to reduce tariff obligations. The company also failed to include the cost of computer tablets incorporated into packaged equipment.  

The settlement also resolves a qui tam False Claims Act case brought by a whistleblower, Mr. Greg Dahlstrom. Dahlstrom will receive $420,000 of the proceeds from the settlement. 

2. Importing Precursor Chemicals: Possible Life Sentence

On April 27, 2026, the United States Attorney for the Southern District of New York announced the unsealing of an indictment charging two Chinese nationals with importing a methamphetamine precursor chemical into the United States with the intent […]

By |2026-05-11T14:35:41-04:00May 2, 2026|Enforcement|0 Comments
Read More

Trade-Based Money Laundering Red Flags: What CBP’s New CTPAT AML Guidance Means for Importers

As global supply chains grow more complex, regulators are increasingly focused on how legitimate trade can be exploited to move illicit funds. In July 2025, U.S. Customs and Border Protection (CBP) reinforced this focus by issuing updated CTPAT Warning Indicators for Trade‑Based Money Laundering (TBML) and Terrorist Financing.  

Although the target audience for this guidance is CTPAT participants, all importers, logistics providers, and financial institutions can be implicated in TBML schemes if they don’t proactively screen for such activity in their supply chains. The Department of the Treasury released its 2026 National Money Laundering Assessment, which further highlights how TBML schemes are used to facilitate the transfer of illicit proceeds. Any business engaged in international trade that is unaware of how TBML works or fails to screen for such practices is exposed to engaging in TBML. 

CBP’s message is simple: trade compliance and anti‑money laundering (AML) expectations are converging, and companies that fail to adapt face growing regulatory, operational, and reputational risk. CBP also emphasizes that TBML rarely presents as a single red flag; instead, it emerges through patterns that deserve closer scrutiny and informed judgment.  

Warning Indicators 

One of the most significant risk areas identified by CBP involves pricing and payment anomalies that defy commercial logic. Persistent over‑ or under‑invoicing, unexplained invoice changes, or pricing that is misaligned with market norms may indicate that a trade […]

By |2026-04-13T09:02:09-04:00April 13, 2026|Enforcement, Import, International Trade, Supply Chain|0 Comments
Read More

New OFAC Advisory: Signs of Sham Transactions and Sanctions Evasion

On March 31, 2026, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) released an important advisory addressing the growing use of sham transactions to evade U.S. sanctions. The guidance highlights how sanctioned individuals and entities often attempt to disguise their continuing interest in property through opaque legal structures, proxies, and other intermediaries. OFAC’s message is clear: transactions that merely appear to transfer ownership but do not genuinely extinguish a blocked person’s interest remain prohibited. 

What OFAC Defines as a “Sham Transaction” 

Sham transactions occur when blocked persons “give up their property on paper only,” while continuing to benefit from or control the asset. These arrangements often involve: 

  • Proxies, straw owners, or front companies acting on behalf of sanctioned individuals. 
  • Opaque legal structures, including multi‑layered LLCs, partnerships, or trusts. 
  • Transfers to family members or close associates who may serve as facilitators. 
  • Commercially unreasonable transfers, such as those lacking adequate consideration. 
  • Continued use or control of the asset by the blocked person after the purported transfer. 

Pro Tip: Look beyond legal formalities and identify the economic realities of the transaction. 

Red Flags Identified by OFAC 

The advisory outlines several indicators that a transaction may be a sham designed to evade sanctions. These include: 

By |2026-04-07T16:53:01-04:00April 3, 2026|Enforcement, International Law, International Trade, Investigation, U.S. Office of Foreign Assets Control (OFAC)|0 Comments
Read More

ICYMI: Electronics Company Pays $11.8M to Resolve Duty Evasion Allegations

The Department of Justice announced that Harman International Industries, Inc., an audio electronics company, agreed to pay $11.8M to settle allegations of evading duties on goods made of aluminum from China.

What Happened

For a period of over ten years, from June 2011 to March 2023, Harman knowingly imported heat sinks that contained extruded aluminum from China without paying the required antidumping and countervailing duties (AD/CVD).

The settlement also reveals that when Harman discovered its failure to pay AD/CVD, the company concealed this fact and decided not to disclose it to the U.S. government. 

This case arose from a whistleblower lawsuit filed under the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The whistleblower in this case will receive over $2M of the settlement proceeds.

Enforcement is a Top Priority for the U.S. Government

High tariffs in the current trade environment have created a higher incentive to cheat. The U.S. government has made clear that enforcing customs laws is a top priority. 

For example, 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 […]

By |2025-12-12T09:10:25-05:00December 12, 2025|Enforcement, Import, International Trade, U.S. Customs and Border Protection (CBP), U.S. Department of Justice (DOJ)|0 Comments
Read More
This website uses cookies and third party services. By continuing to use our website, you agree to the Privacy Policy. OK
Skip to content
Go to Top