A statement published by the U.S. Department of Justice last Friday emphasizes the renewed commitment of the interagency Trade Fraud Task Force to “holding parties accountable for their attempts to undermine honest American competitors” through U.S. trade law violations. Evolutions in U.S. trade and tariff policy have made for a complex compliance environment. With U.S. government agencies stepping up enforcement efforts, many businesses may be impacted by these efforts or will be able to leverage agency resources to combat trade behavior by competitors.
Renewed Emphasis on Compliance
In keeping with the “America First Trade Policy” memorandum of January 20, 2025, the Trump Administration has undertaken a multi-pronged approach to reshape U.S. trade policy. This approach has included a series of new and revised tariff regimes under the International Emergency Economic Powers Act (“IEEPA”), Section 232 of the Trade Expansion Act of 1962 (“Section 232”), and Section 301 of the Trade Act of 1974 (“Section 301”). Sanctions have continued to expand and the Administration’s July Reciprocal Tariff Rates announcement previewed additional duties for yet-to-be-defined “transshipment.” Another significant example is the removal of the ‘de minimis’ exemption for goods valued under $800, to now require entry and payment of duties. The U.S. Department of Commerce (“Commerce”) has also reconsidered regulations related to the determination and enforcement of antidumping and countervailing duty rates. And while the foregoing continue to evolve, yet other multi-pronged initiatives have begun with respect to trade in seafood, shipbuilding, and seabed mining.
The Administration has emphasized enforcement to make its policy changes effective in practice. Per Friday’s memorandum, this includes ensuring “the payment of all applicable tariffs and duties.” It also implicates the Administration’s previously-announced concept of an “External Revenue Service” dedicated to the collection of trade-related revenue for government-funding purposes.
Friday’s announcement is another step forward in DOJ’s commitment to focus efforts on pursuing customs fraud and tariff evasion, as outlined in the May 12, 2025, memorandum issued by Matthew R. Galeotti, Head of the DOJ’s Criminal Division. This memorandum identifies “trade and customs fraud, including tariff evasion” as an area of white-collar crime targeted for DOJ prioritization.
What’s New in the TFTF
The Trade Fraud Task Force itself is not a new entity. Although not heavily publicized, it has been credited with trade enforcement activity extending at least as far back as the first Trump Administration. Indeed, last week’s notice cites various civil settlements of alleged duty evasion dating back to March of this year. Thus, the DOJ characterizes the task force as “augment[ing] the existing coordination mechanisms” within the agency, while a representative of U.S. Immigration and Customs Enforcement-Homeland Security Investigations (“ICE-HSI”) describes the TFTF as having been “revitalized and expanded,” likely to include additional personnel (particularly from the criminal divisions within the DOJ), resources, and consideration from leadership across government as a top priority and integral part in the Administration’s trade agenda. Nevertheless, the TFTF’s core mission remains to “aggressively pursue enforcement actions against any parties who seek to evade tariffs and other duties, as well as smugglers who seek to import prohibited goods into the American economy.”
TFTF activities will continue to include both civil and criminal components, seeking not only unpaid duties, but also penalties, seizures, and criminal prosecution where appropriate. These are necessary, DOJ says, to avoid harming American workers, threatening critical domestic industries, undermining consumer confidence, weakening national security, and losing government funding streams.
As an intergovernmental agency task force, the TFTF has historically benefitted from the exchange of information from other government agencies, including U.S. Customs and Border Protection (“CBP”), ICE/HSI, and even independent agencies such as the Federal Maritime Commission. A separate Executive Order encouraging interagency information-sharing also has direct implications for trade enforcement through the TFTF, serving to strengthen these relationships, and creating the potential for additional coordination with other agencies. In this regard, Friday’s announcement reinforces the commitment of the DOJ and the Department of Homeland Security that their agencies will work closely together to enhance investigations.
Referrals and Self-Disclosures Accepted
Recognizing that businesses themselves are often best positioned to identify fraudulent activity by their competitors, the DOJ’s announcement “welcomes referrals and cooperation from the domestic industries that are most harmed by unfair trade practices and trade fraud” and otherwise “welcome[s] the vital contribution of whistleblowers.” Parties with relevant information can complete an intake form and email the same to the DOJ Criminal Division’s Corporate Whistleblower Program. This dynamic is likely to increase the pressure on non-compliant importers. Competitors that have undertaken costly and burdensome compliance measures may pursue a level playing field using the DOJ referral mechanism or potentially share in the government’s recovery through a qui tam suit.
As a practical matter, the recent changes in trade and tariff policy have obliged many importers to reassess their supply chains and compliance practices to account for new rules. Importers are responsible for ensuring that their customs documentation appropriately and accurately reflects the tariff classification, country of origin, declared value, documentation and recordkeeping, particularly pertaining to any claims made under USMCA or determination of U.S. content value. Nevertheless, importers cognizant of imperfections in their compliance procedures have certain options available to them as well. DOJ references “voluntary self-disclosures” and CBP can accept “prior disclosures.” However, utilization of these mechanisms requires an importer to have a strong grasp of their own compliance profile, e.g., by undertaking an internal audit.
Compliance Assistance and Trade Evasion Prosecution
Cassidy Levy Kent’s attorneys, compliance professionals, economists, and licensed customs brokers guide clients through the constantly and quickly changing trade landscape. Our team works with companies to develop and execute creative and effective solutions to trade issues that make sense for their business, including but not limited to the qui tam actions, prior disclosures and voluntary self-disclosures mentioned above. We expect further developments on these and other U.S. agency actions and will continue to provide updates. Please contact us with any questions.