US Arrest Conspirators in $200 Million Smuggling Scheme Through SoCal Ports
The U.S. Attorney’s Office in California today, January 27, announced indictments and arrests breaking up an elaborate smuggling operation that they estimate smuggled at least $200 million worth of counterfeit and illegal goods from China into the U.S. through the ports of Los Angeles and Long Beach. Law enforcement reports they have seized more than $1.3 billion worth of counterfeit goods from this and similar smuggling operations in the ports.
The indictments were unsealed on Friday and seven individuals were arrested in the scheme. An eighth individual was taken into custody on Saturday and a ninth remains a fugitive. A trial date has been set for March.
According to law enforcement, it was an elaborate conspiracy involving logistic companies’ executives, warehouse owners, trucking firms, and the managers of the truck drivers. They worked together to smuggle the goods through the ports of Los Angeles and Long Beach and conceal the operations from customs and law enforcement.
“Secure seaports and borders are critical to our national security,” said Acting United States Attorney Joseph T. McNally. “The smuggling of huge amounts of contraband from China through our nation’s largest port hurts American businesses and consumers. The charges and arrests here demonstrate our commitment to enforce our customs laws and keep the American public safe.”
Law enforcement explained that the co-conspirators were redirecting containers moving from the port to an inshore inspection location. The containers were being transported by drivers hired by the conspirators and taken to locations, including warehouses in the City of Industry, that were controlled by one of the defendants.
“It was a team of CBP agriculture specialists assigned to the Los Angeles/Long Beach seaport who in 2023, during a routine examination of a container made the initial discovery,” said Cheryl Davies, U.S. Customs and Border Protection, Director of Field Operations in Los Angeles.
Once the conspirators got the containers to their sites, they broke the security seals on the shipping containers and removed the contraband. Then, they stuffed the containers with “filler” cargo to deceive customs and law enforcement, and affixed counterfeit seals to hide the fact the containers had been opened. The containers were delivered to the Customs and Border Protection locations where they were presented for inspection.
During the investigation into this operation, investigators seized more than $130 million in contraband. According to the indictment, a search of one warehouse used by the group led to the seizure in June 2024 of $20 million worth of counterfeit items including shoes, perfume, luxury handbags, apparel, and watches.
The defendants include the head of the logistics company, the manager of a company that hires truckers to move containers from the Port of Los Angeles, and managers of the warehouses. They also indicted the owner of a trucking company, as well as a driver, a manager who coordinated truckers from the port to warehouses, and a manager of truck drivers.
The indictment says the operation was ongoing from at least August 2023 to June 2024. The goods being smuggled and sold in the U.S. were coming from China and law enforcement believes it was just one example of similar “seal-swapping” schemes.