The following cases are the result of “Operation Crash,” an ongoing multi-agency effort to detect, deter, and prosecute those engaged in the illegal killing of rhinoceros and the illegal trafficking of endangered rhinoceros horns.
United States v. Zhifei Li (D.N.J): On May 27, 2014, Zhifei Li, the owner of Overseas Treasure Finding in Shandong, China, was sentenced to serve 70 months’ incarceration. He also will forfeit $3.5 million in proceeds from his criminal activity as well as several Asian artifacts. Li was in the business of selling raw rhino horns to factories where they would be carved into fake antiques and then resold. Horns that Li acquired were smuggled across international borders. The horns were hidden by a variety of means, including wrapping them in duct tape, hiding them in porcelain vases that were falsely described on customs and shipping documents, and labeling them as porcelain vases or handicrafts. The pieces left over from the carving process were sold for alleged “medicinal” purposes. Li admitted that he was the “boss” of three antique dealers in the United States whom he paid to help obtain wildlife items and smuggle to him through Hong Kong. Rhino horn carvings valued as high as $242,500 were sold to Li’s customers in China. Shortly after arriving in the United States in January 2013, Li was arrested in Florida on federal charges brought under seal in New Jersey. Prior to his arrest, he had purchased two endangered black rhinoceros horns from an undercover U.S. Fish and Wildlife Service agent in a Miami Beach hotel room for $59,000 while attending an antique show. Li pleaded guilty to conspiracy to smuggle and to violate the Lacey Act, six smuggling violations, one Lacey Act trafficking violation, and two counts of making false wildlife documents. Li admitted to being the organizer of an illegal wildlife smuggling conspiracy in which 30 raw rhinoceros horns (worth approximately $3 million) were smuggled from the United States to China. http://www.justice.gov/usao/nj/Press/files/Li,%20Zhifei%20Sentencing%20PR.html
United States v. Michael Slattery, Jr. (E.D.N.Y.): In 2010, Michael Slattery traveled from England to Texas to acquire black rhinoceros horns. Slattery and others used a day-laborer with a Texas driver’s license as a straw buyer to purchase two horns from an auction house in Austin. The defendant and his group then traveled to New York where they presented a fraudulent Endangered Species bill of sale and sold those two and two other horns for $50,000. Slattery pleaded guilty to conspiracy to violate the Lacey Act. On January 10, 2014, the defendant was sentenced to serve 14 months’ incarceration, a $10,000 fine, and ordered to forfeit $50,000 of proceeds from his illegal trade in rhinoceros horns. http://www.justice.gov/opa/pr/irish-national-sentenced-serve-14-months-prison-trafficking-endangered-rhinoceros-horns
United States v. Xiao Ju Guan a/k/a Tony Guan (S.D.N.Y): On July 29, 2014, Xiao Ju Guan (“Tony Guan”) was charged with violations stemming from the smuggling of endangered black rhinoceros horns from the United States to Canada. Guan was arrested in March after attempting to purchase two black rhinoceros horns for $45,000 from undercover FWS agents. The defendant is a Canadian citizen and the owner of Bao Antiques, a company based in Canada and Hong Kong. Guan and co-conspirators allegedly smuggled more than $500,000 of rhino horns and sculptures made from elephant ivory and coral from various U.S. auction houses to Canada by driving them across the border or by having packages mailed directly to Canada with false paperwork and without the required declaration or permits. A rhino horn purchased in Florida, for example, was described on Customs paperwork as a “Wooden Horn” worth $200. http://www.justice.gov/opa/pr/canadian-antique-dealer-charged-trafficking-wildlife
United States v. Gene Harris (S.D. Fla.): On October 1, 2014, Gene Harris was sentenced to a term of probation of three years, the first six on home confinement with electronic monitoring, and a criminal fine of $10,000. Harris had previously pleaded guilty, on July 3, 2014, to ESA and Lacey Act charges stemming from the illegal purchase of black rhinoceros horns. Harris was involved in the retail sale of wildlife products, including taxidermy mounts, from locations in Miami, Florida, and Laredo, Texas. Between June 2011 and July 2011, Harris had phone conversations from Miami with a customer in California to arrange for the customer to buy black rhinoceros horns from a couple living in Phoenix, Arizona. In July 2011, Harris and the customer travelled to Phoenix, where the customer purchased a full black rhinoceros shoulder mount, including the two horns for approximately $60,000 cash. The horns were removed from the mount, and a falsified invoice was prepared to make the transaction appear to be solely an intra-state deal, by listing a third-party Arizona resident as the buyer. Harris was paid a $10,000 finder’s fee.
United States v. Ning Qiu (E.D. Tex.): On June 24, 2014, Ning Qiu, an appraiser of Asian art, pleaded guilty to participating in an illegal wildlife smuggling conspiracy in which rhinoceros horns and objects made from rhino horn and elephant ivory worth nearly $1 million were smuggled from the United States to China. Qiu pleaded guilty to a one-count information charging him with conspiracy to smuggle and to violate the Lacey Act. The defendant admitted to being one of three antique dealers in the U. S. paid by Zhifei Li, the admitted “boss” of the conspiracy, to help obtain wildlife items and smuggle them to Li via Hong Kong. Li played a leadership role in the conspiracy by arranging for financing to pay for the wildlife, purchasing and negotiating the price, directing how to smuggle the items out of the U.S., and obtaining the assistance of additional collaborators in Hong Kong to receive the smuggled goods and then smuggle them to mainland China. Qiu worked at an auction house in Dallas as an appraiser of Asian artwork and antiques, specializing in carvings made from rhinoceros horns and elephant ivory. He entered into the conspiracy with Li, traveling throughout the U.S. to purchase raw and carved rhinoceros horns and elephant ivory for Li. Upon purchasing the items, Li transferred funds directly into Qiu’s bank accounts here and in China. After acquiring the items for Li, Qiu arranged for them to be smuggled to a location in Hong Kong, which was provided by Li. Between 2009 and 2013, the defendant purchased and smuggled into Hong Kong at least five raw rhinoceros horns weighing approximately 20 pounds. Qiu smuggled the raw rhino horns by wrapping them in duct tape and hiding them in porcelain vases. Customs and shipping documents were falsified by labeling the contents as vases or handicrafts. http://www.justice.gov/opa/pr/texas-man-pleads-guilty-rhino-and-ivory-smuggling-conspiracy
United States v. Edward N. Levine et al. (D. Nev.): On April 2, 2014, Edward N. Levine and Lumsden W. Quan were charged with violations stemming from the illegal sale of black rhinoceros horns. The two are charged with conspiracy to violate the Lacey Act and the Endangered Species Act, and one count of violating the Lacey Act. According to the indictment, over the course of approximately two months, the defendants negotiated the sale of two black rhinoceros horns by e-mail and telephone, ultimately communicating with an undercover officer. Quan and Levine are further alleged to have offered for sale two black rhinoceros horns for $55,000, agreeing to meet the buyer in Las Vegas. On March 19, 2014, after directing another person to drive with the horns from California to Las Vegas, the defendants flew from California to Las Vegas, to make the sale. Quan met the undercover officer in a Las Vegas hotel room, where he allegedly completed the transaction for the agreed upon amount. Both men were arrested later that day. http://www.justice.gov/opa/pr/two-california-men-indicted-selling-endangered-black-rhinoceros-horns
United States v. Dawie Groenewald, et al. (M.D. Ala.): On October 23, 2014, an indictment was unsealed charging South African nationals, brothers Dawie and Janneman Groenewald, and their company, a large game hunting business, with conspiracy to violate the Lacey Act and to commit mail fraud and money laundering. The defendants allegedly sold illegal rhino hunts to American hunters at U.S. hunting shows. The hunters were each told a similar story about how the particular rhino that they would hunt was a problem animal that needed to be killed and so no export permit was available. Instead, the cost of the hunt was considerably less ($10,000 or less) than one where a hunter could bring back a trophy. The defendants sold the horns from the rhinos killed in the scheme to contacts who smuggled the horns to Asia. The hunts themselves were unlawful because they were conducted in violation of South African law and without required hunting permits. This scheme was hidden from the American hunters, typically through a series of misleading and/or false representations that led the American hunters to assume or believe that the hunts were legal. During the period of the conspiracy, Janneman lived in Alabama. Dawie Groenewald was previously convicted in this district for his role in smuggling a leopard skin into the United States. He, his wife, and ten others were arrested in South Africa in September 2010 on 1,872 counts of racketeering, including the illegal trade in rhinoceros horns. http://www.justice.gov/opa/pr/owners-safari-company-indicted-illegal-rhino-hunts