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Financial Crimes
03/16/2011

Owner and company indicted in scheme to smuggle goods from china in order to avoid paying at least $1.15 million in customs duties

BALTIMORE - A federal grand jury has indicted a Chinese national, and a company he controls, Woncity Inc., for conspiracy, smuggling, making false customs entries, and false classification of goods in connection with a scheme to smuggle large amounts of plastic bags into the United States from China. The indictment resulted from an investigation by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) and U.S. Customs and Border Protection (CBP).

The indictment against Jin Qing Huang, 55, was returned on March 3, and was unsealed Tuesday upon Huang's arrest. Huang had an initial appearance in U.S. District Court in Baltimore March 15, and is being detained pending a detention hearing scheduled for March 22.

The indictment was announced by U.S. Attorney Rod J. Rosenstein, District of Maryland; Special Agent in Charge William Winter of ICE HSI in Baltimore; and CBP Baltimore Port Director Ricardo Scheller.

"Anyone breaking our nation's Customs tariffs laws gains an unfair financial advantage over law-abiding competitors," said Special Agent in Charge Winter. "ICE HSI will continue to aggressively investigate individuals and companies who attempt to operate outside our laws and regulations."

"CBP is pleased with the grand jury indictment of Mr. Huang," said Baltimore Port Director Scheller. "These charges acknowledge the serious impact dumping has on the competitiveness of American businesses and on our nation's economic vitality. CBP is committed to working closely with ICE and the U.S. Attorney's Office to bring future antidumping violators to justice."

Huang is president of Woncity, a privately owned company with warehouses located at 1225 4th St., NE, in Washington, D.C., and 2800 Annapolis Road in Baltimore. Huang and Woncity allegedly imported plastic bags and restaurant supplies into the United States for resale. CBP assesses antidumping duties on plastic bags to prevent foreign manufacturers and importers from "dumping" merchandise at below cost in the United States. Plastic bags exported from China are subject to a 77.57 percent antidumping duty.

According to the 10-count indictment, from November 2006 to July 2010, Huang and Woncity conspired to defraud the United States of more than $1.15 million in antidumping duties accruing on large volumes of plastic bags that Huang and Woncity imported from China for use in the United States at supermarkets and Chinese restaurants. The defendants allegedly smuggled the goods into the United States by causing foreign suppliers of the plastic bags to issue false commercial invoices which vastly understated the quantity and value of the goods that the defendants imported; they also mischaracterized the nature of imported goods to avoid significant anti-dumping duties. The defendants also allegedly filed and caused the filing of false documents with CBP.

The indictment seeks forfeiture of at least $1.15 million, the amount of antidumping duties that the defendants allegedly failed to pay.

Huang and Woncity face a maximum fine of $250,000 on each of the 10 counts.

Huang faces a maximum sentence of five years in prison for conspiracy, 20 years in prison on each of three counts for smuggling, and two years in prison on each of three counts for making false customs entries, and two years on each of three counts for making false classifications of goods.

U.S. Attorney Rosenstein praised ICE HSI and CBP for their work in the investigation.

Mr. Rosenstein also thanked Assistant U.S. Attorney Harry Gruber, who is prosecuting this case.

An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.