CBP officers at Chicago O’Hare International Airport seized a cache of jewelry worth nearly $700,000 from a U.S. citizen arriving from Paris via London — one of the more significant failure to declare violations under 19 U.S.C. § 1497 we have seen publicized at O’Hare. The full CBP release is available here. Here is what happened:
A 65-year-old U.S. citizen was selected for examination by CBP officers as he arrived from Paris via a flight from London. The passenger claimed nothing on his Automated Passport Control declaration, his written declaration, and confirmed to CBP officers that he had not made any purchases or acquisitions on his trip. Upon examination of his baggage, CBP officers noticed receipts for various boxes containing what appeared to be high-end jewelry, invoices and receipts. Some loose jewelry was discovered concealed in pockets of articles of clothing within his luggage. A total of 29 high value jewelry pieces were identified. Upon discovery of the jewelry, the passenger provided CBP officers with the values of each item and stated that he works as a jewelry distributor in the United States. Computer checks indicated that the passenger has imported jewelry in the past on several occasions. The total estimated domestic value of all 29 items is $691,553. The jewelry was seized under 19 USC 1497, failure to declare. The passenger faces a maximum penalty equal to the domestic value of the undeclared merchandise and forfeiture of the jewelry. Had the passenger made a proper declaration, he would have paid $30,043.75 in duty.
What This Violation Actually Cost Him
The last line of the CBP release is the one that should command the most attention: had the passenger made a proper declaration, he would have paid $30,043.75 in duty. Instead, he now faces three separate problems that will cost him dramatically more than that.
- Pay the original duties owed — $30,043.75. This amount is owed regardless of how the penalty and seizure proceedings resolve. Declaring the jewelry and paying the duties was always the legal obligation. That amount does not go away.
- Respond to the penalty notice — The maximum penalty under 19 U.S.C. § 1497 for failure to declare is equal to the domestic value of the undeclared merchandise. On $691,553 worth of jewelry, the maximum penalty is $691,553. CBP will almost certainly issue a notice of penalty at or near the statutory maximum as its opening position.
- Fight to get the jewelry back — The 29 pieces of jewelry were seized and are subject to forfeiture. A separate petition or claim process is required to recover the merchandise itself, independent of the penalty proceeding.
What the Penalty Will Actually Look Like After Mitigation
CBP’s mitigation guidelines for commercial failure-to-declare violations establish a range rather than a fixed amount. For a commercial importer — and this passenger declared himself a jewelry distributor with a history of prior jewelry importations — the guidelines generally result in a mitigated penalty of between 3 and 8 times the duty that was owed. On $30,043.75 in duties, that range is approximately $90,000 to $240,000.
That range assumes a well-prepared petition for mitigation that identifies every applicable mitigating factor and makes the strongest possible case. An unrepresented petitioner who simply explains the circumstances without addressing the legal mitigation framework is unlikely to achieve the lower end of that range. The 60-day response window on the penalty notice is not long, and the penalty decision, once issued without a timely response, becomes final.
Several aggravating factors are present here that will make achieving the lower end of the mitigation range more difficult. The passenger claimed nothing on three separate occasions — his APC declaration, his written declaration, and verbally to CBP officers. He confirmed he had made no purchases or acquisitions. Officers found receipts and invoices in his bags, which means documentation of the purchases was present and discoverable before any denial was made. He is a professional jewelry distributor with a history of prior jewelry importations — meaning CBP will treat him as a sophisticated commercial importer who knew the declaration requirements. Each of these factors is aggravating under CBP’s guidelines and supports a higher penalty within the range.
The Concealment in Clothing — Why It Matters
Some of the loose jewelry was found concealed in pockets of clothing within the luggage. That concealment detail elevates the case beyond a simple omission on a declaration form. An experienced jewelry distributor who places high-value pieces in the pockets of clothing packed in his bags — rather than in a jewelry case or openly accessible location — is engaging in active concealment rather than passive non-declaration. CBP will view this as evidence of intentional evasion, not an oversight, which affects both how the violation is characterized and how receptive FP&F will be to mitigation arguments.
If He Does Not Pay the Penalty
A CBP penalty that goes unpaid does not disappear. If the passenger fails to pay the mitigated penalty after the petition process, CBP can refer the debt to the Department of Justice for collection litigation in federal district court. Once a judgment is entered, the government has the full range of collection tools available: liens on real property, garnishment of bank accounts, and seizure of assets. For a jewelry distributor with business assets and inventory, federal judgment creditor status for the U.S. government is an extremely serious exposure that extends well beyond the immediate penalty amount. See our article on how CBP can garnish tax refunds and other federal payments to collect customs penalties.
Getting the Jewelry Back — A Separate Process
The penalty proceeding and the forfeiture of the jewelry run on parallel tracks. The notice of seizure for the merchandise will include an election of proceedings form with its own response deadline — separate from the penalty notice deadline. To recover the 29 jewelry pieces, the passenger must file a petition for remission of the seizure, which requires demonstrating that the forfeiture is inequitable or that the violation was unintentional — a difficult argument given the facts, but available as a legal option. Without a timely response to the notice of seizure, the jewelry is administratively forfeited and the opportunity to contest it is lost.
Great Lakes Customs Law has a strong track record in getting these kinds of penalties reduced and, in appropriate cases, eliminated entirely. If you are in a situation like this one — or if you have received a notice of penalty or notice of seizure for any failure-to-declare violation — contact us immediately. Call us at (734) 855-4999, send a text message, or reach us on WhatsApp. You can also contact us online.