Tariff evaders may face criminal charges under Trump’s DOJ

00:00 Josh

Companies trying to find a workaround on tariffs should be careful as the Department of Justice plans for a push to prosecute tariff evasion. For more, let’s get to Yahoo Finance’s Alexis Keenan. Alexis?

00:16 Alexis Keenan

Hey, Josh. I’ve been talking to lawyers to find out if their clients, their business clients are, uh, a little bit worried about this new effort by the Justice Department. What they’re doing is they’re stepping up enforcement efforts for tariff evasion and putting criminal prosecution on the table. Now, that’s a real shift, uh, that’s now part of the broader Trump administration tariff agenda, and it’s different because past administrations, including Trump’s first administration, the route to prosecute, to go after tariff evaders, that was usually done on the adminis- administrative level, uh, not really so much in the criminal realm, except for very, very serious offenses. Now, they tended to focus on keeping the, uh, controlled exports, controlled, uh, goods out of the reach of, uh, US adversaries like Iran and China and North Korea. That was really the focus on the criminal realm in the past. But this new plan really is putting scrutiny on all types of importers, and that could be really a big headache for some of the smaller and mid-sized businesses. Trade attorneys can run, uh, somewhere around the range of $1,100 an hour. So not really a workable budget for a lot of companies. And also, the stakes for a criminal conviction, they’re high. They include jail time. They have steep fines, especially for intentional invasion. Uh, that can include forfeiture of an entire, uh, imported or exported product. Now, the DOJ is really has its work cut out for it here, um, because there has been problems in the past with China and, uh, highly tariff nations nations trying to avoid these tariffs. But now, when there are much steeper and broader tariffs across the board, those incentives, right, they shoot up. So the DOJ definitely, uh, whether it’s going to have enough staff to prosecute the way that it envisions, we have yet to see. Uh, some of the common, uh, tariff evasion tactics are things like misclassifying goods and falsely claiming a country of origin. Um, but we’ll have to wait a little bit to see how this all plays out, but this is definitely a larger push. And the attorneys that I’ve been talking to say, uh, that these clients should really be getting their ducks in a row and reassessing their risk to make sure they have their products classified accurately, Josh.

04:48 Josh

Alexis, thank you. Appreciate it.