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.
The case is: United States v. Yingshun Garments, Inc., 13 Civ. 0055 (LAK) (S.D.N.Y. September 29, 2017)
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 | firstname.lastname@example.org
Andrew Siciliano | +1 (631) 425-6057 | email@example.com
© 2018 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.