Joru Ka Ghulam
Everyone knows you can go to jail for exporting a container to China but did you know that you can go to jail for the export of a luxury car, classified as EAR99, China.
Well, it seems you can, according to an article in the Journal-Sentinel Milwaukee Mao Peng, a resident of Kenosha, Wisconsin, and his wife were arrested in Los Angeles for the export of luxury vehicles in China and returned to Wisconsin for trial only the terminated criminal proceedings in Los Angeles PACER when the case transferred in Wisconsin has not shown yet PACER, so loads of details are a bit difficult to discern.
But it appears a number of sources of information, as this article in the New York Times that federal prosecutors have targeted people buying luxury vehicles in the US, and then export them to China for resale apparently, there is a price difference between the prices of luxury vehicles in the United States and China create an attractive arbitrage opportunity for ambitious entrepreneurs and automakers have enlisted some how the Department of Justice to help to preserve their margins in China.
At the request of the luxury car manufacturers, the US government was the seizure of cars and bank accounts, but at least one federal judge called fault The opinion in this case gives clues as to the theories of prosecutors in the case of export of luxury cars in this case, the secret services before the alleged bank accounts contain funds from the export activity of an automotive dealer because the luxury car dealers are prohibited by manufacturers to sell cars for export, dealers require buyers to sign, in the purchase documentation, representation cars are for their own use and not for export brokers export pay straw buyers to buy vehicles for them, the government of the theory is that brokers are conspiring with straw buyers to commit wire fraud in relation to representations of personal use by straw buyers the district court held, based on the convergence requirement that the false statement was more a contractual breach rather t han a criminal case because the auto dealers to whom the misrepresentation were made are not harmed by the misrepresentation; only manufacturers were.
Peng cases, what appears to be the first criminal prosecution for export cars in China, maybe a little different because it seems that its straw buyers were Native Americans and that sales taxes were therefore not paid on vehicles delivered to reserves on which they lived It also appears that the government claims that Peng was still using the names of the straw buyers for more purchases they had agreed and that this was a kind of identity theft but according to the article in the Journal-Sentinel, it also appears as if the government is essentially based on non-export representations made by straw buyers to auto dealers.
Copyright 2015 All rights reserved Clif Burns No republication, syndication authorized use without my consent.
In the past, they have also seized on the fact that exporters have identified cars as used in filing AES, when in fact they do not meet this definition in the FTR CBP regs, because the buyer is not a final buyer so they can ask a false statement to the government and you can export t a new vehicle without an affidavit manufacturer OEM won t hand Basically, it shows that luxury brands are getting good value for their lobbyists.
In fact, you can send a new vehicle with a declaration of original manufacturers MSO or a valid document state the title and it is clear from the opinion of the District Court that dealers will sometimes provide the MSO with the new vehicle.
It seems a thin straw on which to hang a criminal case that the AES saying that the vehicle is used is false because the vehicle was purchased for export, then resold.
Perhaps there is more to this story International Trade in used cars is a very well known method to launder money, I wonder if all this was happening.
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