8:09 p.m., July 28
Local scammers import $100 million in foreign goods without paying taxes
Gerardo Chavez, former president of the San Diego Customs Broker Association, pleaded guilty last week to a massive fraud ring that cost the U.S. $18 million in unpaid import taxes.
The Spring Valley resident and co-defendant Carlos Medina of Chula Vista last Thursday admitted to conspiring to import goods from China and elsewhere, instructing his co-conspirators to falsify documents implying that the goods were merely passing through the United States on their way to Mexico or other points abroad, Courthouse News Service reports.
Once goods were offloaded from trans-Pacific ships, Chavez and Medina would have them sent to various Southern California warehouses, where the bogus paperwork vouching for their export was created and processed. The loads would then be sent to Los Angeles before being distributed across the country for resale.
The scheme resulted in over $100 million in goods being imported effectively tax-free. Chavez faces up to 25 years in prison and restitution up to $18 million to cover lost federal, state, and local taxes. Medina could get up to 5 years imprisonment when the two are sentenced in January.
More like this:
- Got a license for that financial transaction? — Oct. 17, 2014
- He gets 37 months for cheating government on trade — July 1, 2013
- California State Gas Tax Increasing July 1st While Current Gas Taxes Wasted By City Governments — May 17, 2013
- Bad Customs customs — Nov. 15, 2012
- Eight Individuals Charged in Customs Fraud — July 25, 2012