Sunil Jiwat Mirwani, Customs Duty Evasion, California 2013

A federal jury has convicted a Los Angeles-based businessman of evading customs duties on over $30 million in Chinese-made textiles. Sunil Jiwat Mirwani, the owner of M Trade, Inc., was found guilty of conspiring to defraud the United States, importing goods by means of false statements, and conspiring to launder money.

The evidence presented at trial showed that Mirwani hired a group of San Diego-based businessmen and logistics professionals to initiate shipments of his merchandise from ports in China to the Port of Long Beach, California. When the goods arrived, Mirwani and his conspirators would ensure that the merchandise was classified as “in bond,” meaning it would not enter the commerce of the United States, but instead be transshipped through the territory of the United States to Mexico.

However, rather than complete the transshipment to Mexico, Mirwani and his conspirators would divert the merchandise to Mirwani's El Monte, California-based warehouse, as well as to other warehouses in the Los Angeles-area. Having imported this merchandise effectively duty-free, Mirwani would then sell his jeans, shorts, and skirts within the United States at an advantage over his law-abiding competitors.

As part of the scheme, Mirwani and his conspirators falsified customs documentation and database entries, even going so far as to forge special perforation marks found on particular customs filings. The evidence also showed that Mirwani conspired to launder money, transmitting nearly $10 million from M Trade, Inc.'s bank account to the account of Mirvana International, a Hong Kong-based company that Mirwani shares with his twin brother.

The verdict is a significant blow to Mirwani and his corporation, with both defendants facing a maximum penalty of 5 years in prison, 3 years of supervised release, a $250,000 fine, and a $100 special assessment. A sentencing hearing is scheduled for September 9, 2013, at 9:00 a.m. before United States District Judge Michael M. Anello.

The case highlights the importance of protecting the economic health of the United States and ensuring that no one exploits American and international markets for their personal gain. As U.S. Attorney Duffy said, “Not only does this type of fraud deplete our public treasury, but it also deprives domestic manufacturers and law-abiding importers of a level playing field.”

Mirwani's conviction is a testament to the hard work and dedication of law enforcement agencies in preventing and investigating customs duty evasion schemes. The IRS CI, in particular, played a crucial role in uncovering the fraud and bringing Mirwani to justice. “Evasion of any type of tax, income tax or otherwise, is a crime and IRS CI will prosecute known perpetrators to the fullest extent of the law,” said Jose A. Gonzalez, Special Agent in Charge for Internal Revenue Service Criminal Investigation (IRS CI).

Defendant: Sunil Jiwat Mirwani and M Trade, Inc.

Criminal Charges: Conspiracy to Defraud the United States (18 U.S.C. § 371), Importing Goods by Means of False Statements (18 U.S.C. § 542), and Conspiring to Launder Money (18 U.S.C. § 1956(h)).

City and State: Los Angeles, California

Exact Date: June 5, 2013

Sentence or Outcome: Convicted and awaiting sentencing

Dollar Amounts: $30 million in Chinese-made textiles, $10 million laundered through Mirvana International

Source: https://www.justice.gov/usao-sdca/pr/los-angeles-based-businessman-convicted-scheme-evade-customs-duties-30-million-chinese