Online Clothing Business Owners Sentenced For Customs Fraud, Money Laundering
FRESNO, Calif. – Husband and wife, Hoang Minh Nguyen, 32, and Dung Hang Dao, 32, of San Jose, were sentenced today by United States District Judge Lawrence J. O’Neill to 12 months of time-served and ordered to pay $70,000 in restitution for customs fraud and money laundering, United States Attorney Benjamin B. Wagner announced. The defendants also agreed to forfeit bank accounts and a property valued at more than $400,000.
According to court documents, from November 2008 through January 2013, Nguyen and Dao owned an online clothing company that utilized several websites to sell clothing imported from China to customers in the United States. As part of their scheme, Nguyen and Dao declared the imported clothing as samples even though they would later sell it to customers. By declaring the clothing as samples, Nguyen and Dao were able to avoid paying customs duties.
With the proceeds from their business, Nguyen and Dao sent significant amounts of cash to China via Western Union money transfers. They broke up the cash deposits to Western Union agents into amounts of $10,000 or less in an attempt to prevent Western Union from filing Currency Transaction Reports on those transactions, in violation of the Bank Secrecy Act. In addition, Nguyen and Dao laundered the proceeds of their business by purchasing properties in Patterson and San Jose. Nguyen and Dao pleaded guilty to the charges on February 12, 2014.
“Commercial smuggling schemes like this not only rob the government of vital revenues, they also undermine the economy and penalize businesses that follow the rules,” said Mike Prado, resident agent in charge of HSI Fresno. “We will continue to vigorously prosecute those unscrupulous importers who gain an unfair advantage.”
This case is the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the Internal Revenue Service – Criminal Investigation, and the Central California Financial Crimes Task Force. Assistant United States Attorney Grant B. Rabenn prosecuted the case.