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Document and Benefit Fraud
05/05/2014

San Jose couple to forfeit more than $400,000 for customs fraud scheme

FRESNO, Calif. — A San Jose couple was sentenced to 12 months' time served, ordered to pay $70,000 in restitution and will forfeit more than $400,000 in cash and property for their customs fraud and money laundering scheme.

Husband and wife owners of an online clothing business, Hoang Minh Nguyen and Dung Hang Dao, both 32, falsified import documents to avoid paying customs duties, according to court records. An investigation by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), Internal Revenue Service-Criminal Investigation, and the Central California Financial Crimes Task Force uncovered the customs fraud and revealed a money laundering scheme.

Court documents state that from November 2008 through January 2013, imported clothing from China that they sold on several websites they owned. The coupled declared the imported clothing as samples even though they would later sell it to customers. By declaring the clothing as samples, Nguyen and Dao were able to avoid paying customs duties.

With the proceeds from their business, Nguyen and Dao sent significant amounts of cash to China via Western Union money transfers. They broke up their wire transfers into amounts of $10,000 or less in an attempt to prevent Western Union from reporting the transactions to the government, as required by the Bank Secrecy Act. In addition, Nguyen and Dao laundered the proceeds of their business by purchasing properties in Patterson and San Jose.

"Commercial smuggling schemes like this not only rob the government of vital revenues, they also undermine the economy and penalize businesses that follow the rules," said Mike Prado, resident agent in charge of HSI Fresno. "We will continue to vigorously prosecute those unscrupulous importers who gain an unfair advantage."

Nguyen and Dao pleaded guilty to the charges in February.