U.S. wholesaler to pay, false claims violations | KPMG | US

U.S. wholesaler to pay $1 million, false claims violations

U.S. wholesaler to pay, false claims violations

A consent order from a federal district court reveals that a Pennsylvania wholesaler of women’s clothing agreed to pay $1 million to settle claims for damages for violations of the False Claims Act with respect to false statements made by an overseas manufacturer with respect to the imported garments. The Pennsylvania company also agreed to implement a written customs compliance policy.

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The case is: United States v. Yingshun Garments, Inc., 13 Civ. 0055 (LAK) (S.D.N.Y. September 29, 2017)

Summary

U.S. Customs and Border Protection (CBP) alleged that between 2009 and 2014, the Pennsylvania corporation that functioned as a wholesaler of women’s clothing violated the False Claims Act (31 U.S.C. section 3729(c) and (g)) by making false statements that were material in determining the amounts of import duties owed on women’s clothing that were purchased and imported into the United States. 

Specifically, the wholesaler failed to take action in response to “multiple warning signs” that its supplier in China (and certain related entities in the United States) were undervaluing imports of knitted sweaters. Among the identified warning signs was the fact that the invoices were incomplete and failed to show that procedures for importing the sweaters were being followed.

 

For more information, contact a professional with KPMG’s Trade & Customs practice:

Douglas Zuvich | +1 (312) 665-1022 | dzuvich@kpmg.com

Andrew Siciliano | +1 (631) 425-6057 | asiciliano@kpmg.com

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