Tag: crimes

Customs Money Seizure of $175,000 in Unreported Currency at Port

As reported recently by U.S. Customs & Border Protection:

U.S. Customs and Border Protection officers conducting outbound inspections selected a Mercedes sedan driven by [a male Mexican national], [aged] 29, of Nogales, Sonora, Mexico, for further inspection. During the search, officers found a concealed compartment containing 14 packages of U.S. currency. The vehicle and cash were seized. Lara was arrested and referred to U.S. Immigration and Customs Enforcement-Homeland Security Investigations.

175k Money Seizure Unreported

The total for the concealed currency, which was seized, was more than $175,000 in  U.S. currency. This individual was arrested and likely faces state or federal charges for bulk cash smuggling, or other similar violations. If he could prove legitimate source and legitimate intended use of the funds, then this situation is regrettable for him and completely avoidable.

So, if you have had currency seized from Customs, I strongly advise against trying to do it yourself. Get the help of an experienced attorney who knows what he is doing. If you do not, you might only make the situation worse by handling it on your own or hiring a lawyer who does not regularly handle these types of matters.

To inform yourself, please read the various articles I have written on this and related topics. But do not let it replace the advice of attorney who is familiar with the law and your particular circumstances. If you have questions, please give us a call at (734) 855-4999.

 

CBP Seizes Money at Texas Port of Entry

We bring these cases to our reader’s attention not because many honest people find themselves with thousands of dollars hidden underneath their vehicle’s floorboards in a secret compartment (although it has happened to some of my honest clients), but because they do allow me to bring to the public’s attention the laws surrounding the transportation of more than $10,000 in money across the border and seizure of that money.

Customs and Border Protection, in a recent news releaseCBP Seizes Money Texas Port Of Entry discusses the seizure of $80,000 as a result of a failed smuggling attempt to take the cash out of the country in a

concealed compartment and without filing a currency report disclosing the source of the money and intended use of the money. Thus, it was seized and the driver arrested for smuggling.

The news release states as follows:

CBP currency detector canines searched the vehicle and alerted to the floor. CBP officers and Border Patrol agents continued their search and located a hidden compartment in the floor of the vehicle. They removed multiple tape-wrapped bundles of money in the compartment.

If this individual is found not guilty of a crime, then he faces the ¬†potentially difficult task of proving a legitimate source and legitimate intended use of the money.¬†In this case, we could give the man the benefit of the doubt and presume the legitimate source is the proceeds the sale of valuable pieces of art to an eccentic U.S. art collector and the intended use, perhaps he was intending to open a small restaurant in Mexico City. That’s just my guess, and yes, I have handled more bizarre but true cases.

If we assume he proves these two things, then this situation is regrettable for him and completely avoidable. But now, even if criminal charges are ultimately not filed or if he is ultimately found not guilty of a crime, he will still face civil forfeiture of the money and, if he wants it back, will have to fight for its return administratively, or in the courts.

That brings me to the next point:

If you have had currency seized from Customs, do not go it alone. Get the advice of an attorney who knows what he is doing. If you do not, you might only make the situation worse by handling it on your own or hiring a lawyer who doesn’t regularly handle these cases.

To inform yourself, please read the various articles I have written on this and related topics. But do not let it replace the advice of attorney who is familiar with the law and your particular circumstances. If you have questions, please give us a call at (734) 855-4999.

U.S. Customs Money Seizure of $460,000 in Smuggled Currency

CBP reports that a money smuggling attempt in Nogales, Arizona, was stopped. This story looks similar in dollar amount — $464,00 seized – amount as a money seizure by¬†U.S. Customs and Border Protection¬†near the Port of Laredo, which I blogged about here.

Us Customs 460k Smuggled Money Seizure
Picture of currency hidden in a nightstand.

This time, though, instead of the money apparently being hidden in the vehicle itself, it looks like it was hidden in a nightstand. Either way, hiding it is most likely going to result in a charge of smuggling, which is basiscally what bulk cash smuggling amounts to.  This resulted in a seizure of the vehicle and the money itself.

For more information on money seizures by U.S. Customs, the reporting requirements, structuring violations, bulk cash smuggling, and how to get seized currency back, please visit our page devoted to discussion of currency seizures, and also read these articles:

And of course, if you have had your money seized by U.S. Customs and Border Protection, do not delay and call our office immediately at (734) 855-4999! You can also fill out our form and we will contact you, or drop us an e-mail by visiting our Contact page.

Reducing Penalties through Prior Disclosures of 1592 Import Violations

Importing into the United States requires the importer exercise reasonable care, but competitive market forces and human nature can create the temptation to reduce expenses and maximize profits by finding new ways to save money through questionable application of the customs laws. Failing to exercise reasonable care, however, means possibly being penalized by Customs for import violations under § 1592. ((In summary, if any person does or attempts to enter or introduce merchandise into the United States by means of any material omission or material and false document, written or oral statement, or act that has the potential to alter the classification, appraisement, or admissibility of merchandise Customs will impose costly penalties on the violator. Bear in mind that Customs can impose penalties  Рcivil, criminal and monetary Рunder a variety of federal laws, not just under 1592.)) This means, among other things, an importer must make sure that they are classifying the merchandise properly. under the correct duty rate, giving accurate dutiable values and descriptions for the merchandise, marking the country of origin correctly, and much more. Failure to do so could cost you dearly in the form of severe monetary penalties, among other potential penalties, imposed by Customs.

"I think we could lessen our penalty exposure if we make a valid prior disclosure."
“Say, our customs attorney says we can lessen our penalty exposure if we make a valid prior disclosure to U.S. Customs for those import violations we found.”

CBP encourages importers who may have committed a violation to make a “prior disclosure.” If an importer becomes aware of ¬ß 1592 violations, they should not wait for Customs to notify them of the violations and demand payment of duties¬†and penalties; rather they should act immediately and pro-actively and disclose violations or potential violations to Customs so that they can take advantage of significant penalty reductions allowed for those who disclose violations prior to a Customs investigation. This “prior disclosure” process is a formal notice, usually in writing, made to Customs regarding the circumstances of a 1592 violation. 19 CFR ¬ß 162.74.

How to Make a Valid Prior Disclosure

For a prior disclosure to be valid, a person must first make the prior disclosure before, or without knowing, that Customs has begun a formal investigation into the potential violation ((A prior disclosure can still have some benefit after a investigation has begun)); also, if the amount of duty loss is known, tender any actual loss of duties, taxes and fees or actual loss of revenue to Customs. In addition to this, the person must disclose the circumstances of the violation, including:

(1) Identif[ying] the class or kind of merchandise involved in the violation;

(2) Identif[ying] the importation or drawback claim included in the disclosure by entry number, drawback claim number, or by indicating each concerned Customs port of entry and the approximate dates of entry or dates of drawback claims;

(3) Specif[ying] the material false statements, omissions or acts including an explanation as to how and when they occurred; and

(4) Set[ting] forth, to the best of the disclosing party’s knowledge, the true and accurate information or data that should have been provided in the entry or drawback claim documents, and stat[ing] that the disclosing party will provide any information or data unknown at the time of disclosure within 30 days of the initial disclosure date. [ . . . ]

19 CFR 162.74(b).

It should be noted that, because the issues that go into making a valid prior disclosure are often complex, when properly done a person can still initiate a valid prior disclosure while avoiding immediate payment of suspected duty loss, and get additional time to assemble all the necessary information.

How Penalties Can Be Reduced or Avoided

Meeting these requirements will qualify the person for substantial penalty reductions in the event that penalties are appropriate. In order for Customs not to levy penalties at all Customs must find the absence of fraud, the presence of negligence or gross negligence, and the merchandise must be unliquidated. In the case of negligence or gross negligence and liquidation has already¬†occurred¬† the penalty will be “the interest on any loss of duties, taxes and fees” “at the prevailing rate of interest” under the Internal Revenue Code. 19 CFR ¬ß 162.73(b)(2).

If the violation is a result of fraud and a valid prior disclosure is made, the penalty may be reduced from the equivalent to the domestic value of the goods and to only the amount of lost duties, taxes and fees, or if not duty loss, then just 10% of the dutiable value.

If you believe or have a question about whether you should make a prior disclosure, or have concerns about representations made to Customs or omissions  it is in your best interest to consult with an attorney experienced in customs law and prior disclosures. Please contact our office today at (734) 855-4999, or by visiting our contact page.

Structuring currency imports and exports

The law concerning reporting transportation of more than $10,000 in currency and/or monetary instruments coming into or out of the United States is clear; any amount more than $10,000 must be reported. So what about two or more of transactions of $10,000 or less?

It is illegal to structure an importation or exportation in order to avoid filing the required report under 31 USC ¬ß 5324(c)(3).¬†For example, if a person wanted to transport $25,000 from the U.S. to Brazil, it is illegal to divide the money into smaller sums and export those smaller sums on the same or different occasions to avoid filing a report. It does not matter if the money is divided and given to a ¬†person on the same flight (or same car, bus, boat, etc.), or if it’s done days, weeks, months, or years apart if done to avoid having to file a report — structuring the transaction to avoid filing the report is illegal and carries serious civil and/or criminal consequences. It does not matter if you have other reasons for structuring the transaction, so long as one of those reasons to is to avoid having to file a report your structuring of the transaction is illegal.

On the other hand, dividing the money for any reason other than evading the reporting requirement is legal. However, my typical cautionary disclaimer applies: you still have to prove it and convince Customs that your intent was not to avoid filing a report, and hope that your evidence is strong enough to get your money back (remember, Customs will have seized it pursuant to 31 USC § 5317).

If you have had cash seized by customs and are contemplating what to do next, please make use of the other information available on this website or call our office at (734) 855-4999 to speak to a customs lawyer, or e-mail us through our contact page. We are able to assist with cash seized by customs around the country, including Chicago, Atlanta, New York, Los Angeles, Orlando and many other places, and not just locally in Detroit.

Please read these other articles:

  1. Seizure of currency and monetary instruments by U.S. Customs
  2. Seizure for bulk cash smuggling into or out of the U.S.
  3. Structuring currency imports and exports
  4. Is it $10,000 per person?  Under what circumstances is filing a report with Customs for transporting more than $10,000 required?
  5. Criminal & civil penalties for failing to report monetary instrument transportation
  6. Is only cash currency subject to seizure by Customs?
  7. Responding to a Customs currency seizure
  8. How do I get my seized money back?
  9. Getting money seized by U.S. Customs back while staying overseas
  10. How long does it take Customs to decide a petition for a currency/monetary instrument seizure?

Penalties for monetary reporting violations

Is it a crime to transport more than $10,000 without reporting it?

Yes, it is a crime to transport more than $10,000 without reporting it if you are entering or leaving the United States. There are both criminal and civil penalties for failing not report carrying more than $10,000, but not everyone is charged with a crime. A person can be charged criminally or just be responsible for a civil violation, as well as forfeiture of your monetary instruments.

What are the criminal penalties for not reporting more than $10,000?

The criminal penalties for not reporting more than $10,000, or omitting or misstating a material fact in a report potentially brings with it criminal penalties. That includes, depending on the severity of the violation, a fine ranging from $250,000 to $500,000 and/or prison time from 5 to 10years.

What are the civil penalties for not reporting more than $10,000?

The civil penalties for not reporting more than $10,000 is a fine of not “more than the amount of the monetary instrument for which the report was required.” Any civil penalty assessed for a violation of failing to report currency at the border is reduced by the amount of money that was forfeited (forfeiture is a permanent loss of the money to the government).

What are the penalties for structuring a transaction to avoid filing a currency report?

The penalties for structuring a transaction is avoid filing a currency report are similar. The relevant law makes it illegal, when importing or exporting more than $10,000 in monetary instruments,  to:

(1) fail to file a report . . . , or cause or attempt to cause a person to fail to file such a report;
(2) file or cause or attempt to cause a person to file a report required . . . that contains a material omission or misstatement of fact; or
(3) structure or assist in structuring, or attempt to structure or assist in structuring, any importation or exportation of monetary instruments.

If structure cash in any of these ways you could be be fined and/or imprisoned for no more 5 years. There are additional, higher penalties when done as “a pattern of any illegal activity involving more than $100,000 in a 12-month period.

In addition to the criminal penalties for structuring cash there are also civil penalties. 31 USC 5321. The amount of the civil penalty will not be greater than the amount involved in the transaction, and that amount shall be reduced by the amount of any monetary instruments forfeited.

Will a civil penalty for a cash reporting violation stay on my record?

IA civil penalty for a cash reporting violation will not stay on your record for most purposes. That is, if you’re not criminally charged then the only people who will ever be able to find out this happened is the government agencies who have access to your travel record. Customs will always have a record when you cross the border that you were transporting currency and failed to file a report. This will, in all likelihood, mean that you will at some point while crossing the border be questioned about whether or not you have currency or have your baggage examined. There is nothing that can be done to avoid that, except if it becomes unfair you can file a complaint through the DHS Traveler Redress Inquiry Program (DHS TRIP).

If you are not criminally charged you will not have a criminal record.

Questions about a customs cash seizure?

If you have had cash seized by customs and are contemplating what to do next, please make use of the other information available on this website like our trusted customs money seizure legal guide (or watch the videos) and can contact us for a free currency seizure consultation by clicking the contact buttons on this page.