$400M Tariff-Dodging Scam Busted 🚔

TRADE NEWS

Busted: $400 Million Tariff Evasion Network

U.S. Customs and Border Protection (CBP) has shut down one of the largest duty-evasion schemes ever uncovered, exposing more than $400 million in unpaid tariffs across multiple investigations. The probe, carried out under the Enforce and Protect Act (EAPA), revealed widespread efforts to sidestep duties first imposed during the Trump administration.

Officials said the most significant case involved 23 Chinese shell companies that routed goods through South Korea, Indonesia, and Vietnam to disguise their origin. That single network alone accounted for over $250 million in unpaid duties—making it the largest consolidated EAPA investigation to date. On-site inspections added weight to the findings. When investigators visited mattress factories in Taiwan and Indonesia, they found facilities with no active production—evidence that the companies were simply being used as fronts to funnel Chinese-made products into the U.S. market under false pretenses.

CBP leadership emphasized that while $250 million has been tied to this one scheme, the broader total uncovered across EAPA enforcement actions now exceeds $400 million. Officials also warned that the figure is expected to climb further as additional importers are flagged.

The enforcement sends a strong signal to global supply chains: attempts to reroute goods through third countries to escape tariffs will face heightened scrutiny. For U.S. companies, the case highlights the government’s continued commitment to creating fair competition by shutting down schemes that tilt the playing field in favor of bad actors. As trade tensions remain high and tariff policies continue to evolve, this action underscores the risks for importers who attempt to game the system—and the scale of CBP’s enforcement capabilities when they do.

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