VW agrees to pay largest civil penalty of $1.45 billion.

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Last Wednesday – January 11, 2017, U.S. Customs and Border Protection (CBP), along with Attorney General Loretta Lynch announced a criminal and civil settlement against Volkswagen totaling $4.3 billion.

According to this press release, VW violated customs laws by submitting to CBP false statements and omitting material information with the intent to deceive or mislead CBP concerning the admissibility of vehicles into the US. More specifically, it is claimed VW falsely represented to CBP that nearly 590,000 imported vehicles complied with all applicable environmental laws while knowing these representations to be untrue.

VW plead guilty to three felony counts for false statements regarding their vehicle’s compliance with emissions and will be required to pay a $2.8 billion criminal penalty along with a $1.45 billion civil penalty to settle fraud claims by CBP and the US Environmental Protection Agency.

 

What happens after a Customs currency seizure?

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In my blog post yesterday, I discussed what happens after a U.S. Customs and Border Protection (“Customs”) seizure of items and merchandise. Today’s post is along the same line but will focus instead on currency (cash) seizures by Customs.

Most of our clients report seizures of currency and cash while they are either entering or exiting an airport or at a border crossing. At the time of seizure, Customs will give you a receipt of the seizure. This is form 6051S and is officially known as the “Custody Receipt for Seized Property and Evidence”. It is important to keep this receipt as it will contain the identification number of your seizure for tracking purposes and is your only proof of the money seizure. If you do receive this form, be sure it is properly filled out and contains how much money was seized, the officer seizing the property, and contact information.

Following the seizure, Customs must send you a CAFRA Notice of Seizure that further details the seizure (why it was seized, date, location seized, and additional facts). You will get the seizure notice in the mail and it will be sent certified mail (you sign the green card, or you will receive a notice to pick up the certified mail letter at your local post office).

Once you receive the notice, you have to respond by 30 days from the date of the notice (not the day you physically receive the notice).

Your response to the seizure notice requires you to complete an “Election of Proceedings” form that will be included with the seizure notice. Customs will not easily return your seized currency and there are many nuances involved – contact me for a free consultation regarding your currency seizure.

 

What happens when U.S. Customs seizes your items?

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We are often asked what happens after U.S. Customs and Border Protection (“Customs”) seizes your merchandise. While there are many different scenarios and factors that influence the client’s specific seizure case, here’s our effort to summarize what typically happens.

At all the ports of entries into the U.S., Customs will stop, examine, search, detain and or seize merchandise from persons entering or leaving the U.S. or merchandise being being exported or imported to and from the U.S.

Customs officers are entrusted to enforce the hundreds of laws for the over 40 government agencies, such as the U.S. Fish and Wildlife Service, U.S. Department of Agriculture and the U.S. Food and Drug Administration (“FDA”). Customs’ job is to assist these agencies in ensuring unsafe and prohibited items are not allowed to enter the U.S.

A typical Customs officer may search for items such as counterfeit merchandise, illegal drugs, food or drugs not approved by the FDA or items from a country in which the U.S. has an embargo. The list of prohibited items is exhaustive and our clients are often surprised their items were seized.

Items and merchandise held by Customs are sent to a Centralized Examination Station (“CES”) to “maintain control and accountability of merchandise imported into the United States” (U.S. Customs and Border Protection, CBP Directive No. 3270-007A). Customs has 35 days from the time of arrival of the items in the U.S. to detain the items for examination. At this time, Customs will also notify the importer, customs broker or attorney with an explanation for the detention.

After 35 days has passed, the cargo must be seized or released. However, as previously mentioned, the amount of various government agencies involved and associated bureaucracy may cause a delay of 60 days or more.

If it is determined that a violation did occur, the merchandise will be seized by Customs and then transported to a Seized Property warehouse. Once the items arrive at the warehouse, it will remain there until it is authorized to be released by Customs. The paperwork regarding the seized items will then be sent to a Customs Fines, Penalties, and Forfeitures Office (FP&F). At the FP&F, a paralegal reviews the file, prepares a written Seizure Notice and mails the notice to the party responsible for the items.

The Seizure Notice identifies when and where the cargo was seized along with the basis for the seizure.

It is important to seek immediate assistance when you receive a Seizure Notice as Customs only allows 30 days to Petition Customs for the release of the seized items. A Petition is a written explanation to persuade Customs to release the seized items. Not timely filing a Petition may result in the seized items being destroyed or disposed of.

Customs may grant the petition and release the items or Customs may deny the petition. In the event the petition is denied, you have the option to file a Supplemental Petition or Offer in Compromise.

As each seizure case is different, contact me at dhsu@givensjohnston.com to discuss your specific case at no charge.