Five Hit With $40M Customs Fraud Charges

Five alleged masterminds of a massive customs fraud scheme have been hit with charges that could send them to federal prison for life. United States Attorney David L. Anderson, along with Homeland Security Investigations (HSI) and Internal Revenue Service Criminal Investigations (IRS-CI), announced the charges against Dale Behm, Yong Heng Liang (a.k.a. Colin Liang), Joshua Stanka, Joshua Clark, and Michael Choy.

Their alleged crime: a $40 million conspiracy to defraud the United States by submitting fraudulent claims for refunds on import duties. The indictment, filed August 12, 2020, reveals that the defendants utilized a tire recycling company in Hayward and a shell company under Liang’s control to orchestrate their deception.

Liang, 34, of Daly City, Calif., Behm, 75, of Shell Knob, Missouri, Stanka, 41, of Katy, Texas, Clark, 38, of Fair Oaks Ranch, Texas, and Choy, 47, of Etibicoke, Ontario, Canada, are accused of exporting thousands of used tires to Asia under false pretenses. They forged shipping documents to claim the tires were high-quality plastics, thereby seeking refunds for other imports.

Special Agent in Charge Tatum King of HSI emphasized the environmental implications: “Used tires don’t belong in landfills, either here or overseas. By dumping them in Korea, India, and Vietnam, these defendants cheated consumers, American taxpayers, shipping companies, and everyone who cares about the environment.”

Special Agent in Charge Kareem Carter of IRS-CI called the network “extremely well organized,” noting that the scheme involved millions in false claims and ill-gotten gains. IRS CI vowed to work with law enforcement partners to ensure accountability.

The indictment details how the defendants manipulated bonded companies, like The Pacific Rim Traders, LLC, a San Francisco-based raw plastics importer. They submitted documents allowing the company to receive refunds by falsely labeling shipping containers filled with used tires and scrap plastic as virgin plastic material.

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