Apparel Company CEO Charged With Evading Import Duties
George Iloulian, CEO of apparel company Delta Uniforms of New York, skimped on import duties by understating the true value of his company's imports, the U.S. Attorney's Office for the Southern District of New York said. Arrested on Sept. 23, Iloulian was then presented in Manhattan federal court where the civil fraud lawsuit was unsealed. Iloulian is accused of violating the False Claims Act by lying on entry documents submitted to CBP.
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From 2010 to 2020, Iloulian and others, including individuals associated with overseas manufacturers, conspired to submit the fraudulent invoices, the Department of Justice said. The conspirators achieved lower customs duties through a "double-invoicing scheme" and a "fabric-type scheme," the U.S. attorney's office said. For the double-invoicing scheme, Iloulian used two invoices. One was dubbed the "Actual Invoice," and contained higher prices that reflected what Delta actually paid, while the second one, known as the "Customs Invoice," contained the fraudulent lower prices. The latter invoices were submitted via a customs broker to CBP.
For the fabric-type scheme, Delta told its overseas suppliers to misstate the composition of the fabric in the order to secure the lower duty rate, the U.S. attorney's office said. These invoices said the imports were made mostly of cotton rather than the man-made fibers they were actually made of. “As alleged, George Iloulian cheated the United States out of hundreds of thousands of dollars by causing false documents that misrepresented the value of imported goods to be submitted to CBP to avoid paying lawfully owed customs duties. Iloulian now faces criminal charges for his alleged fraud, and the government’s civil suit seeks treble damages and penalties against Iloulian and his company," U.S. Attorney for the Southern District of New York Audrey Strauss said.