Thread: I.C.E. arrest Chinese businessman for conspiracy

I.C.E. News Release

May 06, 2009

Chinese business executive arrested for conspiring to evade U.S. restrictions on imported honey

CHICAGO - An executive of a Chinese honey manufacturer was arrested in Los Angeles Wednesday on federal charges filed in Chicago for allegedly conspiring to avoid U.S. anti-dumping duties by illegally importing honey that was falsely identified as coming from the Philippines. The charges resulted from an investigation conducted by U.S. Immigration and Customs Enforcement (ICE).

Yong Xiang Yan, 60, was arrested without incident three days after he entered the United States and before departing on a domestic flight May 6 at Los Angeles International Airport.

Two other Chinese nationals, Boa Zhong Zhang, who was traveling with Yan, and a suburban Seattle resident, were also arrested on federal charges filed in Seattle for allegedly conspiring to defraud the United States by submitting false customs documents regarding shipments of honey.

Yan is the president of Changge City Jixiang Bee Product Co Ltd., a honey manufacturer located in Henan, China. He was charged with conspiracy in a criminal complaint and is expected to appear Wednesday in U.S. District Court in Los Angeles.

According to the complaint affidavit filed in Chicago, the charges against Yan stem from an ongoing investigation of the honey importing practices of Alfred L. Wolff Inc. (ALW), the food ingredients component of Wolff & Olsen, headquartered in Hamburg, Germany. Two Chicago-based executives of ALW, Stefanie Giesselbach and Magnus Von Buddenbrock, were arrested in Chicago on federal conspiracy charges in May 2008, and are cooperating while the charges against them remain pending, the new affidavit states. Through its Chicago office, ALW has imported nearly $30 million worth of honey into the United States since 2005.

The complaint affidavit against Giesselbach and Von Buddenbrock stated that the Commerce Department and International Trade Administration imposed anti-dumping duties, at a default rate of 221 percent, on importing honey manufactured in the People's Republic of China, effective in July 2007. In October 2002, the Food and Drug Administration issued an import alert for honey containing the antibiotic chloramphenicol, a broad spectrum antibiotic that is used to treat serious infections in humans, but which is not approved for use in food-producing animals, including bees. Honey containing chloramphenicol is deemed unsafe and adulterated within the confines of tU.S. federal food and drug laws. The charges do not allege any instances of illness or other public health consequences attributed to consuming the honey, nor do they identify any store brands or domestic supply chain of any honey that was allegedly illegally imported or adulterated.

The Yan complaint alleges that emails between ALW personnel in Chicago and its affiliated supplier/representative in China corroborate information provided by Von Buddenbrock that Yan - referred to in the emails as "Mr. Nonstop Smoker" - was transshipping honey from China, through the Philippines, to the United States. ICE agents reviewed purchase orders and shipping and payment records issued by ALW's Chicago office for three shipments. They totaled 15 full container loads of Chinese honey that were re-labeled through the Philippines in 2005. The additional anti-dumping duties that would have been imposed if these shipments were imported lawfully directly from China would have totaled in excess of 221 percent of the declared value, the charges allege.

ICE agents also allege that Yan's company, Jixiang, was importing full container loads of Chinese honey into the port of Seattle fraudulently labeled as having originated in Thailand as recently as February 2008. ICE agents seized those containers in April 2008.

Assistant U.S. Attorneys Andrew Boutros and William Hogan, Northern District of Illinois, are prosecuting this case.

If convicted, the conspiracy charge carries a maximum penalty of five years in prison and a $250,000 fine. The court, however, would determine the appropriate sentence to be imposed under the advisory U.S. Sentencing Guidelines.

"ICE will continue to aggressively pursue individuals and organizations that illegally import goods in an effort to defraud the U.S. government and gain commercial advantage over their competitors," said Gary Hartwig, special agent in charge of the ICE Office of Investigations in Chicago.
-- ICE --

U.S. Immigration and Customs Enforcement (ICE) was established in March 2003 as the largest investigative arm of the Department of Homeland Security. ICE is comprised of five integrated divisions that form a 21st century law enforcement agency with broad responsibilities for a number of key homeland security priorities.

Last Modified: Friday, May 8, 2009

http://www.ice.gov/pi/nr/0905/090506chicago.htm

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