38 th International Precious Metals Conference June 7 th, June 10 th, 2014 JW Marriot Grande Lakes Resorts and Spa Orlando, Florida Speaker: Peter Quinter

Peter Quinter, Chair Customs and International Trade Law Group GrayRobinson, P.A. (954) Skype: Peter.Quinter1 Miami, Florida Contact Information

Gold, U.S. Customs and Money Laundering – What is the Connection?

4 Do you have questions about importing/exporting?

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6 United States District Court for the Southern District of Florida United States of America vs. Natalie Ladin and Jed Ladin

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8 Criminal Charges 1.Entering goods into the United States by means of false statements in violation of 18 USC Smuggling in violation of 18 USC Conspiracy to commit money laundering, in violation of 18 USC Conspiracy to smuggle, in violation of 18 USC 371.

9 Trade Based Money Laundering - a means of transferring money from the United States to foreign countries via the purchase of foreign gold on other precious metals or general merchandise from overseas.

10 Bank Secrecy Act PATRIOT Act FINCEN

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15 Allegation Trade based money laundering Undervaluation of gold imports Overpayment for foreign seller for gold imports

16 Importer Declared $6,451,904 in gold scrap shipments Importer wired $24,317,665 to foreign seller of the scrap gold Overpayment of $17,865,761

17 Declared value $187,673 according to commercial invoice of foreign shipper Assayed spot price value according to CBP $697,036 Undervalued by 73% Upon conviction 20 years of imprisonment for each violation

18 Harmonized Tariff Schedule of the United States Chapter 71 Natural or Cultured Pearls, Previous or semiprecious stones, precious metals, metals clad with previous metal, and articles thereof; imitation jewelry; coin The term “precious metal” means- silver, gold, or platinum.

19 Imported Silver, Gold, and Platinum enters the United States DUTY FREE No Customs duties or fees are paid to U.S. Customs and Border Protection

20 U.S. Customs Entry Requirements 1.Value 2.Country of Origin 3.Description 4.Tariff Classification

21 CBP Advance Ruling Procedures Question: how to properly value and declare to CBP scrap jewelry imported on consignments Answer: initially declared insurance value, then after assaying and determining a price, amend the declaration to CBP to reflect the actual price paid

22 CBP Seizure Process Notice of Detention Notice of Seizure from CBP Fines, Penalties, and Forfeitures office

Days to Respond 4 Options –File a petition –Claim and cost bond –Abandonment –Offer in compromise

24 How a Typical Seizure Case Commences with U.S. Customs and Border Protection: U.S. Customs finds a violation, and places the merchandise on hold for “intensive examination”.

25 What Type of Merchandise is Subject to Seizure? Prohibited Merchandise (Counterfeit, Controlled substances) Restricted Merchandise (CPSC, FDA, Quota) Undeclared, unreported or smuggled merchandise (non-reporting of currency over 10,000) Goods which aid or facilitate the illegal importation of merchandise

26 FP&F Refers certain cases to CBP’s Headquarters Cases are sent to Chief, Penalties Branch, Regulations & Rulings, Office of International Trade Value of the merchandise is over $100,000. Novel or complex issues concerning a Ruling, policy or procedure. HQ Recommendation sent to FP&F and Final Decision issued by FP&F.

27 Currency Seizures

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29 Penalty Authority U.S. Customs Statutory authority to issue penalties is from Title 19 U.S.C. § 1592 for:  Fraud  Gross Negligence  Negligence 19 CFR Part 171  Appendix B  Offer in Compromise

Peter Quinter, Chair Customs and International Trade Law Group GrayRobinson, P.A. (954) Skype: Peter.Quinter1 Miami, Florida Contact Information