When the FBI Comes Calling…®
EVASION OF IMPORT DUTIES (continued)
18 U.S.C. § 544 (2005).
Relanding of Goods
The Crime
It is a violation of section 544 to:
- enter or withdraw any merchandise for exportation
- without payment of the duties thereon, or
- with intent to obtain a drawback of the duties paid, or
- of any other allowances given by law on the exportation thereof,
The merchandise will be considered as having been imported into the United States contrary to law. 18 U.S.C. § 544.
The Punishment
The punishment for violating section 544 is
- a fine, imprisonment for not more than two years, or both; and
- the merchandise will be forfeited. 18 U.S.C. § 544.
Case Law Interpreting Section 544
Like section 543 there is little if any current case law on the modern statute. However, one case in particular that evaluates the predecessor statute is particularly enlightening.
Two Thousand Tin Cans 24 F. Cas, 454 (E.D.N.Y. 1873) (No. 14,303).
In this case, a shipment of tin cans had been entered for exportation on board a ship. Two Thousand Tin Cans at 455. Afterwards, and before that particular boat had sailed, the cans were found in a smaller boat next to the original boat. Id. The cans were then seized. Id. The first question was "whether the discharge of goods from the ship to [the other ship] amounts to a landing 'within any port or place within the limits of the United States.'" Id. The court found that it was.
The more interesting point of Two Thousand Tin Cans is that there need not be any intent to defraud the United States government. In this case, the transfer of the cans was done to correct a mistake. However, the court ruled that "[a]n intent to defraud the government of the duties is not required by the statutes to be an element in the case." Id.
18 U.S.C. § 545 (2005).
Smuggling Goods into the United States
The Crime
There are two distinct provisions of section 545. It is a violation for a person to:
- knowingly and willfully, with intent to defraud the United States,
- smuggle, or
- clandestinely introduce or attempt to smuggle or clandestinely introduce into the United States any merchandise which should have been invoiced, or
- make out or pass, or attempt to pass, through the customhouse any false, forged, or fraudulent invoice, or other document or paper; or
- fraudulently or knowingly
- import or bring into the United States, any merchandise contrary to law, or
- receive, conceal, buy, sell, or in any manner facilitate the transportation, concealment, or sale of such merchandise after importation, knowing the same to have been imported or brought into the United States contrary to law. 18 U.S.C. § 545.
The Punishment
The punishment for violating section 545 is
- a fine, imprisonment for not more than five years, or both; and
- the forfeiture of the merchandise, or its value. 18 U.S.C. § 545.
Sufficiency of Evidence
There is a rebuttable presumption that if there is proof that the defendant possessed the goods, that proof will be deemed sufficient evidence to authorize a conviction under section 545. 18 U.S.C. § 545.
Definition
- "United States", as used in this section, shall not include the Virgin Islands, American Samoa, Wake Island, Midway Islands, Kingman Reef, Johnston Island, or Guam.
Case Law Interpreting Section 545
As can be expected, there is quite a bit of case law that interprets both section 545 and its predecessor statutes. As a preliminary matter, "smuggling" should be defined. Smuggling has long been defined as "[t]he fraudulent taking into country, or out of it, merchandise which was lawfully prohibited. Dunbar v United States, 156 US 185, 193 (1895). However, section 545 is not solely concerned with smuggling; it also criminalizes illegal importation of goods, and the two acts should be understood as separate offenses. United States v Westover, 511 F2d 1154, 1155 n.2 (9th Cir. 1975). Finally, in rounding out some of the preliminary considerations, merely importing goods which are subject to a duty without paying the duty is not, in general, an offense against smuggling laws; there must be secrecy or concealment, or intent to defraud the United States of revenue. United States v. Kushner, 135 F.2d 668, 671 (2d Cir. 1943). (Illegal importation, however, does not seem to require an intent to defraud the United States of revenue. Id. at 672.)
United States v. Hassanzadeh, 271 F.3d 574 (4th Cir. 2001).
In Hassanzadeh, the defendant was convicted of illegally importing carpets of Iranian origin, which was prohibited by Executive Order 12,613, 31 C.F.R. § 560.201 (1987). During sentencing, the defendant objected to the inclusion of 42 carpets made before 1935 in the calculation of the loss amount for sentencing purposes. Hassanzadeh at 580. This was certainly a novel argument, because prior to 1935, Iran was known as "Persia." Id. at 580-81. Therefore, the defendant argued, the rugs were not of "Iranian" origin, but "Persian" instead. Id. at 581. But the ban applies to the territory known as Iran, and the court ultimately ruled against the defendant. Id. at 582.
United States v. Boggus, 411 F.2d 110 (9th Cir. 1969).
In Boggus, the defendant was convicted of not properly declaring some gold shavings they had brought into the United States from Mexico. Boggus at 111. The defendant had gone to Mexico to inquire about purchasing some gold bars which he would then sell in America. To test the purity of the gold, he took some shavings back to the United States, and did not declare his possession of the shavings to customs when he returned. Id. A customs agent thereafter contacted the defendant and pretended to be an agent representing the American buyers; when he visited the defendant at the defendant's hotel room, the agent noticed the shavings and then arrested the defendant. Id. at 112. The total weight of the shavings amounted to 6.2 grams. Id. 6.2 grams is about one-fifth of an ounce, which in 1969 was worth roughly seven dollars. Id. at 113.
On appeal the defendant tried to tie 19 U.S.C. § 1484 to section 545 by arguing that there was a five day period for entry. Id. at 112. The court stated however, that 19 U.S.C. § 1484 only applies to a consignee, and furthermore, "[o]nce a person has smuggled something into the country it would be senseless to provide he had five days thereafter to enter and declare it and wash away his crime." Id.
Definition of "Merchandise"
The definition of merchandise actually is quite broad. For example, it can refer to obscene photographs of minors that are not intended for commercial purposes. United States v. Meyer, 802 F.2d 348, 351 (9th Cir. 1986). It also includes marijuana, United States v. Garcia-Paz, 282 F.3d 1212, 1214 (9th Cir. 2002); heroin, United States v. Meza-Arcadia, 458 F.2d 31, 31-32 (9th Cir. 1972); cattle, Babb v. United States, 252 F.2d 702 (5th Cir. 1958) (no objection to use of term "merchandise" in relation to cattle); fish and wild life, United States v. Lee, 937 F.2d 1388, 1397 (9th Cir. 1991); and even baggage. United States v. Chesbrough, 176 F. 778, 781 (D.C.D.N.J. 1910).