Hong Kong to Share in $20.5M Retrieved from Clothing Smuggled Through L.A. Ports
An elaborate scheme that involved bringing in Chinese-made apparel from Hong Kong through Los Angeles ports, allegedly destined for Mexico but ending up in the United States, will result in Hong Kong sharing some of the $20.5 million worth of forfeited assets collected during the investigation.
In 2000, U.S. customs officials launched an investigation into a multinational criminal organization responsible for smuggling hundreds of millions of dollars worth of Chinese-made apparel into the U.S. through the ports of Los Angeles and Long Beach.
The probe by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, which worked with Hong Kong customs officials, revealed that more than 7,000 shipping containers filled with clothing worth more than $600 million were being illegally imported into the United States.
To avoid paying duties and being subject to quotas, the smugglers—working in China, Hong Kong and the United States—provided fake documents to customs brokers saying the Chinese-made garments were being sold to companies in Mexico when they were really being delivered to buyers throughout the United States, resulting in U.S. customs losing $60 million in customs revenues.
When being rerouted to Mexico, the containers were transferred to an in-bond warehouse where they were supposed to be held until transferred by truck to Mexico. But the investigation showed that the containers were making their way to U.S. manufacturers and retailers.
“This payout has been a long time coming, but it’s a testament to the perseverance of the personnel on two continents who were involved in dismantling this scheme,” said Joseph Macias, special agent in charge for HSI Los Angeles. “Commercial smuggling is a multi-billion-dollar industry that robs governments of vital revenues and undermines our economy.”
Besides apprehending more than 200 shipping containers filled with clothing, the investigation resulted in the seizure of a 100,000-square-foot warehouse in Commerce, Calif., near Los Angeles, as well as other business and residential locations in Los Angeles and Laredo, Texas.
In addition, U.S. government investigators seized or obtained restraining orders against two dozen bank accounts in the U.S. and Hong Kong.
Five people, including the owner of a Los Angeles–area trucking company, have been federally charged in connection with the case.
Armando Salcedo, 53, owner of Friends Global Logistics trucking company, pleaded guilty in 2008 to making false customs declarations and smuggling. In addition to receiving an 18-month prison term, Salcedo forfeited nearly $5 million in personal property and other assets to the federal government, including his Downey residence and the Commerce warehouse.
The remaining four defendants remain at large and are considered fugitives.