Senior Auction Official At Beverly Hills Gallery Pleads Guilty In Manhattan Federal Court In Connection With $1 Million Wildlife Smuggling Conspiracy
Preet Bharara, the United States Attorney for the Southern District of New York, John C. Cruden, the Assistant Attorney General for the Environment and Natural Resources Division of the Department of Justice, and Dan Ashe, the Director of the United States Fish & Wildlife Service (“FWS”) announced today that JOSEPH CHAIT, the senior auction administrator of a gallery and auction house located in Beverly Hills, California (“Auction House-1”), pled guilty to conspiring to smuggle wildlife products made from rhinoceros horn, elephant ivory, and coral with a market value of at least approximately $1 million. CHAIT pled guilty to a two-count Information before U.S. District Judge J. Paul Oetken.
Manhattan U.S. Attorney Preet Bharara stated: “Joseph Chait and his co-conspirators trafficked in wildlife, including rhinoceros horns, worth a market value of at least $1 million, deliberately violating laws put in place to protect endangered species. Critically endangered, rhinoceros have one primary predator, humans. And it is people like Chait who, through their criminal schemes, have fueled the trade of endangered wildlife products. We are grateful for the outstanding work of the Fish and Wildlife Service in this investigation, which is ongoing.”
Assistant Attorney General John C. Cruden stated: “Rhinos and elephants have been on earth for millennia but are now at grave risk due to the illegal wildlife trade. The United States and other destination markets have a special responsibility to help save these beloved creatures from extinction. Those in the auction industry need to be responsible and not turn a blind eye to the fact that trade in protected animal parts is highly regulated. Illegal wildlife trafficking takes many forms and those who deliberately break the rules and engage in smuggling will be prosecuted to the full extent of the law.”
Fish and Wildlife Service Director Dan Ashe stated: “This case demonstrates the insidious nature of wildlife trafficking, showing how these activities permeate our society in many social, economic and cultural areas. One criminal at a time. One guilty plea at a time. Federal prosecutors, our devoted team of law enforcement officers, and their colleagues around the globe are helping reduce trade in illegal wildlife products that is decimating populations of some of our most cherished species.”
According to allegations contained in the Information and statements made in court filings and proceedings:
CHAIT and his co-conspirators engaged in illegal trafficking of wildlife with a market value of at least $1 million. CHAIT personally falsified customs forms by stating that rhinoceros horn and elephant ivory items were made of bone, wood or plastic. For example, during Asia Week in New York City in or about March 2011, CHAIT was approached about the potential sale of a carving of Guanyin, an East Asian spiritual figure made from rhinoceros horn (the “Rhino Carving”). Despite knowing that it was not a genuine antique, CHAIT and his co-conspirators accepted the Rhino Carving for consignment, advertised the sale to foreign clients in China, and put the Rhino Carving on the cover of Auction House-1’s catalogue in connection with an auction of Asian art and antiques. After the Rhino Carving sold at auction for $230,000, CHAIT offered to make a false document for the buyer to help the buyer smuggle the item out of the country. The fake invoice falsely stated that the item cost $108.75 and was made of plastic.
CHAIT also sold rhinoceros ivory carvings to another customer, and provided those carvings to that customer’s courier, even after learning that the customer had been arrested in China for smuggling ivory purchased from CHAIT’s auction house.
In addition to falsifying customs forms by stating that rhinoceros horn and elephant ivory items were made of bone, wood or plastic, CHAIT and his co-conspirators conducted their wildlife smuggling using a variety of methods:
Wildlife items were shipped to or picked up by third party shippers, who then re-shipped the items out of the country without the required declaration or permits.
Members of the conspiracy provided packing materials to foreign wildlife buyers to assist them in hand carrying the wildlife out of the country.
Foreign wildlife buyers were sold protected wildlife items without being assessed a state sales tax if they showed a foreign passport and itinerary for an international flight as proof the item would be leaving the country.
Protected wildlife was smuggled into the United States without declaration or permits, and then sold at auction by members of the conspiracy.
As a result of a recent Presidential Executive Order, trade in protected wildlife such as rhinoceros horn and elephant ivory has been significantly restricted in the last two years, except for those instances where sellers can prove that the item is a genuine antique that is more than 100 years old.
Rhinoceros are an herbivore species of prehistoric origin and one of the largest remaining mega-fauna on earth. They have no known predators other than humans. All species of rhinoceros are protected under U.S. and international law. Since 1976, trade in rhinoceros horn has been regulated under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (“CITES”), a treaty signed by over 170 countries around the world to protect fish, wildlife, and plants that are or may become imperiled due to the demands of international markets.
* * *
CHAIT, 38, of Beverly Hills, California, faces a maximum of five years in prison for conspiring to smuggle wildlife products, in violation of 18 U.S.C. §§ 371, 554 and 16 U.S.C. §§ 3372(a) and (d) and 3373(d), and a maximum of five years in prison for violating the Lacey Act, 16 U.S.C. §§ 3372(d) and 3373(d)(3)(A)(i). These statutory maximum sentences are prescribed by Congress and are provided here for informational purposes only, as any sentence imposed on the defendant will be determined by the judge.
CHAIT’s sentencing is scheduled for June 22, 2016, in front of Judge Oetken.
This matter is part of Operation Crash, a continuing investigation by the Department of the Interior’s Fish and Wildlife Service’s Office of Law Enforcement, in coordination with the Department of Justice. A “crash” is the term for a herd of rhinoceros. Operation Crash is an ongoing effort to detect, deter, and prosecute those engaged in the illegal killing of rhinoceros and the unlawful trafficking of rhinoceros horns.
U.S. Attorney Preet Bharara thanked the U.S. Fish and Wildlife Service for its outstanding work in this investigation as well as the U.S. Attorney’s Office for the District of New Jersey for its assistance on this matter. This case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit and the Environmental Crimes Section of the Department of Justice. Assistant United States Attorneys Jennifer Gachiri and Elizabeth Hanft, and Senior Litigation Counsel Richard A. Udell with the Environmental Crimes Section of the Department of Justice are in charge of the prosecution.