Source: United States Department of Justice Criminal Division
The Department of Justice today announced a resolution of a criminal trade fraud investigation into MGI International, LLC and its subsidiaries Global Plastics LLC and Marco Polo International LLC (collectively, MGI), a leading global plastic resin distributor, pursuant to Part I of the Criminal Division’s Corporate Enforcement and Voluntary Self-Disclosure Policy (CEP). The resolution relates to a scheme to falsify Country of Origin declarations to avoid Section 301 duties owed on products of Chinese origin. As part of the resolution with MGI, the department has declined to prosecute MGI and agreed to credit $6.8 million previously paid to resolve MGI’s civil liability under the False Claims Act for knowingly failing to pay customs duties on certain plastic resin imported from China.
Separately, MGI’s former Chief Operating Officer was charged yesterday by criminal information and has agreed to plead guilty to conspiracy to smuggle goods into the United States. According to court documents, in 2021, David Guimond, 48, of Manchester, New Hampshire, instructed subordinates to misrepresent the manufacturer and country of origin on paperwork that was submitted to the U.S. Customs and Border Protection in order to avoid paying the required Section 301 duties.
“As this announcement demonstrates, the department will hold to account individuals and corporations who lie to evade tariffs and duties,” said Deputy Attorney General Todd Blanche. “This resolution makes clear what the incentives for corporations are to voluntarily self-disclose and remediate identified criminal conduct.”
“David Guimond is charged with lying to avoid paying customs duties to enrich his companies and himself,” said Acting Assistant Attorney General Matthew R. Galeotti of the Justice Department’s Criminal Division. “Trade fraud deprives the government of revenue and harms American manufacturers. This corporate resolution and plea agreement demonstrate that the Criminal Division will hold accountable those who defraud the public fisc.”
“Our systems of commerce depend on the fair and accurate application of tariffs,” said Special Agent in Charge Michael J. Krol for Immigrations and Customs Enforcement Homeland Security Investigations (HSI) New England. “When bad actors attempt to evade these tariffs, they undermine the integrity of our trade system and disadvantage honest businesses. We are committed to enforcing tariff regulations and will relentlessly pursue those who seek to circumvent them. This company worked with the government to bring past violations to light and cooperated fully with our investigations. Their actions highlight the importance of corporate responsibility and the value of transparent self-disclosure in maintaining the integrity of our tariff enforcement efforts.”
The department resolved its investigation into MGI after considering the factors set forth in the CEP, including (1) MGI’s timely and voluntary self-disclosure of the misconduct; (2) MGI’s full and proactive cooperation in this matter; (3) the nature and seriousness of the offense; (4) MGI’s timely and appropriate remediation, including termination and disciplinary actions against the employees involved in the scheme, an internal review of the misconduct, an internal review of its compliance program and internal controls, a thorough and systematic root-cause analysis and enhancements to its broader compliance program; (5) the absence of aggravating factors that, when weighed against MGI’s cooperation and remediation, warrant a disposition other than a resolution under Part I of the CEP; and (6) the fact that MGI has already repaid the evaded tariffs.
Guimond has agreed to plead guilty to one count of conspiracy to smuggle goods into the United States and faces a maximum penalty of five years in prison. His change of plea hearing will be scheduled by a federal district court judge.
HSI is investigating the case.
Trial Attorneys Jennifer Bilinkas and Siji Moore of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Yasir Sadat for the District of New Hampshire are prosecuting the case.
These actions were coordinated through the Department of Justice Trade Fraud Task Force, a cross-agency law enforcement effort involving the Criminal Division’s Fraud Section, the Civil Division, the Department of Homeland Security and U.S. Attorney’s Offices nationwide. The Task Force is designed to pursue enforcement actions against parties who seek to evade tariffs and other duties, as well as smugglers who seek to import prohibited goods into the American economy. The Criminal Division, in coordination with the Task Force, leverages all the department’s tools and authorities to fight fraud on the federal government and recover funds for the public fisc.