Importers Avoid Harsher Penalties with Self-Disclosure in $6.8 Million Settlement

Key Takeaways

• $6.8 Million Settlement: Global Plastics and Marco Polo International agreed to pay $6.8 million to resolve False Claims Act liability for failing to pay customs duties on plastic resin imports from China.
• Voluntary Disclosure and Cooperation: MGI and its subsidiaries voluntarily disclosed the violations in 2024 and cooperated extensively with U.S. authorities, including conducting an internal investigation and sharing damage analysis.
• DOJ Credit for Responsible Conduct: The companies received credit under DOJ guidelines for their timely self-disclosure, cooperation, and remediation efforts.
• Trade Enforcement Priority: The Justice Department and CBP emphasized that evading customs duties undermines fair trade and that companies must play by the rules.

Deep Dive

Two U.S. subsidiaries of MGI International LLC (Global Plastics LLC and Marco Polo International LLC) have agreed to pay $6.8 million to resolve civil liability under the False Claims Act for failing to pay customs duties on Chinese plastic resin imports. The companies, based in New Hampshire and New York respectively, admitted to undervaluing goods and mis-declaring their country of origin between 2019 and 2024, according to a Justice Department press release issued Wednesday.

But unlike more combative enforcement cases, this one underscores the potential benefits of owning up to compliance failures.

In 2024, MGI and its subsidiaries voluntarily disclosed the violations to U.S. Customs and Border Protection (CBP) and the U.S. Attorney’s Office for the District of New Hampshire. The disclosure included acknowledgment that the companies had underreported the value and origin of certain plastic resin imports from the People’s Republic of China (PRC), resulting in unpaid duties.

Assistant Attorney General Brett A. Shumate emphasized the DOJ’s commitment to enforcing fair trade rules, stating, “When importers fail to pay customs duties owed, they can mitigate the consequences by making timely self-disclosures, cooperating with investigations, and taking appropriate remedial measures.”

MGI’s cooperation was described as extensive and included conducting a thorough internal investigation, sharing analysis of potential damages, and disciplining responsible personnel. The company also revamped its compliance procedures. These actions earned the firm credit under the Department of Justice’s cooperation guidelines for False Claims Act settlements.

Acting U.S. Attorney Jay McCormack of New Hampshire added that the resolution serves as a reminder that “companies doing business in the United States must play by the rules,” but also highlighted that “responsible corporate behavior” can influence settlement outcomes.

CBP’s acting Executive Assistant Commissioner Susan S. Thomas echoed the sentiment, calling the resolution a win for honest businesses and the American taxpayer. “When companies use unfair trade practices and fraudulent methodologies to avoid paying customs duties, it robs the American people of revenue and undermines our economy,” she said.

The settlement marks another example of how U.S. authorities are leveraging both enforcement and incentive frameworks to promote voluntary compliance in global trade, especially in an era of heightened supply chain scrutiny and shifting geopolitical dynamics. For companies navigating complex import regulations, the case underscores the cost of non-compliance but also the value of coming clean.

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