Mark A. Strauss Law PLLC Announces $3.64 Million Settlement in Qui Tam Whistleblower Lawsuit for Customs Fraud

NEW YORK–(BUSINESS WIRE)–Mark A. Strauss Law, PLLC, a whistleblower law firm, today announced a $3.64 million False Claims Act settlement with apparel importer Luchiano Visconti Loutie, LLC, of ​​East Rockaway, NY, in connection with allegations relating to falsification of customs documents and evasion of import duties on apparel imports from Turkey and China. The who tam the whistleblower – a client of Mark A. Strauss Law, PLLC – will receive a Whistleblower Reward of 20% of the settlement proceeds.

Luchiano, an importer and wholesaler of luxury men’s clothing, admitted as part of the settlement that it regularly provided its customs brokers with information and documents, including commercial invoices, that significantly underestimated the value and the prices paid for the clothes he imported. In some cases, Luchiano modified the invoices provided by its suppliers before providing them to its customs brokers. In other cases, suppliers forwarded invoices that Luchiano knew or had reason to know did not reflect the actual prices she had paid for the goods.

Luchiano also admitted that, through his customs brokers, he significantly under-declared the value of his imports on entry documents filed with U.S. Customs and Border Protection (CBP). and thus regularly underpaid customs duties. From December 2013 to August 2019, he paid no more than $1.8 million in customs duties he was obligated to pay on his imports.

The whistleblower, a Turkish citizen and executive of one of Luchiano’s Turkish clothing suppliers, filed a complaint who tam trial in December 2018 after discovering the fraud in his company’s business dealings with Luchiano. He will receive a whistleblower reward — called a “parent’s share” under the False Claims Act — of approximately $728,000 from the settlement proceeds.

The settlement illustrates the partnership between who tam whistleblowers and the US Department of Justice (DOJ), which has made clear that it is committed to combating customs fraud and that whistleblowers are essential to this effort. Import duty evasion not only harms the public tax but also unfairly disadvantages law-abiding importers.

“Evidence suggests customs fraud is rampant,” said whistleblower attorney Mark A. Strauss. “Whistleblowers like our client in this case play an important role in leveling the playing field for honest importers who responsibly report and pay the duties they owe. We believe similar import duty evasion schemes are proliferating as importers attempt to avoid steep tariffs on Chinese imports under Section 301 as well as new tariffs imposed on imports from Russia. .

“Whether the customs fraud scheme in question involves undervaluation, as in this case, or other types of fraud, such as transshipment of goods through third countries while falsely declaring their country of origin, or the use of inappropriate Harmonized Tariff Schedule (HTS) classifications to avoid higher duty rates, who tam the provisions of the False Claims Act provide a strong incentive for whistleblowers to report this type of wrongdoing,” added whistleblower attorney Mark A. Strauss.

Customs fraud violates the False Claims Act, which places substantial liabilities on parties who knowingly overcharge or underpay the US government or its agencies like CBP. The Misrepresentation Act who tam provisions allow private parties, known as “reporters” or whistleblowers, to sue on behalf of the US government and share in the benefits. Who tam whistleblowers under the False Claims Act – who do not need to be U.S. citizens, like the Luchiano case demonstrates – are entitled to rewards of 15-30% of any recovery.

About Mark A. Strauss Law, PLLC

Whistleblower law firm Mark A. Strauss Law, PLLC, represents who tam relationships under the False Claims Act and other laws and whistleblower programs in the United States. Its founder, Mark A. Strauss, has over twenty years of experience in complex anti-fraud civil litigation and has successfully represented who tam whistleblowers under the False Claims Act as well as victims of financial fraud under federal securities laws. His efforts have recovered hundreds of millions of dollars.

This press release constitutes advertising for attorneys in certain jurisdictions.

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