Six companies and eleven individuals have been arrested on charges of participating in an international honey smuggling operation, US Immigration and Customs Enforcement said on Wednesday.
Ten of the individuals are senior executives with the German company, Alfred L. Wolff GmbH or four affiliated companies that ran a Chicago-based honey-importing business. The ten Germans and one Chinese national have been accused of conspiring to illegally import $40m worth of Chinese honey between 2002 and 2009 – including some allegedly contaminated with disallowed antibiotics – in order to avoid antidumping duties of $78m. No illnesses have been associated with consuming the honey, according to a 44-count federal grand jury indictment.
Chinese honey imported to the US is subject to antidumping duties to ensure it does not unfairly reduce competition, as it is lower in price than what is normally paid domestically. Currently the duty stands at $2.06 a kilogram.
US attorney for the Northern District of Illinois Patrick Fitzgerald said in a statement: "The charges allege that these defendants aggressively sought and obtained an illegal competitive advantage in the US honey market by avoiding payment of more than $78 million in customs duties, and while doing so deliberately violated US laws designed to protect the integrity of our food supply.
“Not only was the government defrauded from collecting substantial customs duties, but domestic honey producers and other importers were denied a fair market, according to the indictment, and the defendants distributed adulterated honey that never should have reached the US marketplace.”
All of the accused face one count of conspiracy, and most of them also face multiple additional counts of smuggling honey, falsifying federal Customs and Commerce Department records, and violating food and drug safety laws.
If convicted, some of the executives could face 20 years or more in prison and fines of $250,000.
The indictment does not identify any food manufacturers, retailers, products or brands that may have been recipients of the honey.