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CUSTOMS BROKER SENTENCED TO PRISON FOR DEFRAUDING MASSACHUSETTS COMPANY OUT OF OVER $1 MILLION

February 18, 2010

BOSTON, MA - A Long Island customs broker was sentenced late yesterday in federal court on charges that he defrauded a Massachusetts medical equipment distributor out of over $1 million dollars.

United States Attorney Carmen M. Ortiz and Bruce Foucart, Special Agent in Charge of Immigration and Customs Enforcement - Boston Field Division, announced today that GREGORY MANUELIAN, age 50, of Manhasset, New York, was sentenced to 24 months in prison, to be followed by 3 years of supervised release (12 months of which will be in home detention with electronic monitoring) and ordered to pay $1,188,886.97 in restitution, based on charges that MANUELLIAN defrauded his client, B-K Medical Systems, a Danish subsidiary of Massachusetts-based Analogic Corporation, by repeatedly submitting phony customs documents which indicated that B-K owed customs duties on goods that were actually duty free.

MANUELIAN operated a customs brokerage in Jamaica, New York called Marquis Clearance, Ltd., and had served as B-K’s customs broker since 1980. When B-K’s goods entered the United States, MANUELIAN, on behalf of Marquis Clearance, ordinarily paid duties and routine charges on them, and then faxed invoices to B-K listing the goods and the duties MANUELIAN pre-paid on B-K’s behalf. B-K reimbursed MANUELIAN for the duties, along with a brokerage fee. In 1996, the United States Department of Commerce began to phase out the duties on the types of medical equipment imported by B-K, such that by 1999, the goods were duty free.

Despite the phasing out of the duties, MANUELIAN continued to bill B-K for pre-paid duties on its equipment, even though he paid none. To legitimize each invoice, MANUELIAN mailed B-K bogus customs forms which showed a duty owed on the medical equipment, usually equal to 5.3% of the equipment’s value. In so doing, MANUELIAN repeatedly induced B-K to reimburse him for duties that he never actually paid, in amounts ranging from $1000 to $9000. By the time B-K discovered its loss in 2006, MANUELIAN had defrauded it out of a total of approximately $1.2 million.

“The customs system is designed to protect and promote foreign commerce and to prevent items from entering the United States without a proper determination of whether duties should be assessed or not. Today’s sentence makes clear that abuse of the system will not be tolerated,” said U.S. Attorney Ortiz.

The case was investigated by Immigration and Customs Enforcement. It was prosecuted by Assistant U.S. Attorney Jonathan F. Mitchell of Ortiz’s Economic Crimes Unit.

 


 

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