According to U.S. Attorney Sally Quillian Yates, Snellville resident Jennifer Chen, 44, chief financial officer of a Georgia-based paper supply company, was arraigned Monday by United States Magistrate Judge Linda T. Walker on "charges of conspiracy to import paper products from China with fraudulent invoices and bills of lading and to avoid customs duties on such products."
She and her ex-husband, Chi Cheng “Curtis” Gung, along with their paper company, Apego Limited, were charged with the conspiracy and twelve counts of "importing notebooks and filler paper from China using false documents."
Gung, also a Snellville resident, is a dual citizen of China and the U.S.
The conspiracy was discovered after Gung's ex-lover and executive assistant turned over a copy of her company laptop's hard drive to the Department of Homeland Security.
In a recent press release, Yates said that “three large Chinese paper manufacturers are charged with conspiring with companies in Taiwan and Gwinnett County to avoid duties imposed by the Commerce Department to protect competition in the U.S. and global paper market."
The amount of avoided customs duties is valued at $20 million.
The investigation began as far back as 2005, when the U.S. Department of Commerce began investigated whether Chinese paper manufacturers of notebooks, filler paper and other lined paper products were selling their goods at an artificially low price in the U.S. market -- a practice known as "dumping," according to Yates.
The goal is to put competitors out of business. Once the competition is eliminated, they can then raise their prices to whatever they want.
When Chen and Gung discovered that the Department of Commerce was cracking down on these practices, they and other companies allegedly "launched a scheme to avoid anti-dumping duties by transshipping large shipments of paper from China through Taiwan to office supply chains and other large retailers in the United States."
They allegedly hired workers in Taiwan to slap "Made in Taiwan" labels on China-made paper products. By allegedly paying bribes at Taiwanese ports, they successfully transported the paper to the U.S.
The maximum penalty for the conspiracy charge is 5 years in prison, a $1 million fine for a corporation, a $250,000 fine for an individual, and 3 years of supervised release. The maximum penalty for the fraudulent importation charges is 2 years in prison, a $1 million fine for a corporation, a $250,000 fine for an individual, and 1 year of supervised release for each count.
For further information please contact the U.S. Attorney’s Public Information Office at USAGAN.PressEmails@usdoj.gov or (404) 581-6016. Visit the U.S. Attorney's Office for the Northern District of Georgia's website.