What Whistleblowers In Import And Manufacturing Should Know

What Is Import Fraud, and How Does it Occur in Manufacturing and Supply Chains?

Import fraud (also referred to as “customs fraud”), which has fallen under the spotlight of the Department of Justice, is any attempt to evade duties, taxes, or trade regulations. This is commonly achieved through deceptive or falsified import documentation. In the manufacturing and supply chains sector, this can be done in several ways: such as undervaluing goods, misrepresenting the goods’ country of origin, or misclassifying goods under incorrect Harmonized Tariff Codes to avoid paying higher tariffs. By deliberately falsifying information regarding the goods and avoiding making obligated payments to the U.S. government, companies increase their profit and undermine fair-trade practices.