Apparel Company and Owner Plead Guilty to Undervaluing Garment Imports From Asia
Ambiance Apparel and its owner reached a plea agreement with the Department of Justice concerning charges of undervaluing imported garments to avoid customs duty costs, the U.S. Attorney’s Office for Central District of California said in an Aug. 26 news release. The Los Angeles company and its owner, Sang Bum Noh, agreed to plead guilty and to pay nearly $118 million, the release said. “Ambiance Apparel -- the operating name for two corporations, Ambiance U.S.A. Inc. and Apparel Line U.S.A., Inc. -- agreed to plead guilty to eight counts, including conspiracy, money laundering, and customs offenses,” it said.
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The company imported garments from Asia and submitted fake invoices to CBP that undervalued the goods, DOJ said. “At Noh’s direction, the Asian manufacturers prepared two invoices for the clothing ordered by Ambiance -- one that usually reflected 60 to 70 percent of the actual price and was paid by letter of credit, and one that reflected the balance of the actual price and was paid by wire transfer,” it said. The company even kept an “Undervalue Calculator” on its computer system to help in the process, DOJ said in the plea agreement.
Noh would then send the lower value invoice to the company's customs broker, who submitted it to CBP to be used for tariff calculation purposes, DOJ said. Between 2010 and 2014, the scheme “resulted in an undervaluation of imported merchandise of approximately $82,669,853, which caused approximately $17,169,492.72 in unpaid tariffs owed to CBP,” DOJ said in the plea agreement. The penalty payment includes $36 million in cash previously seized from Ambiance and Noh, it said.
Email ITTNews@warren-news.com for a copy of the plea agreement.