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Honey Importer Sentenced to 30 Months for Conspiring to Evade U.S. Import Duties_November 2010
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Honey Importer Sentenced to 30 Months for Conspiring to Evade U.S. Import Duties

Michael Fan Ordered to Pay $5,378,370 in Restitution

CHICAGO, Nov. 9, 2010 - A Taiwanese executive of several honey import companies was sentenced to 30 months in prison Friday for conspiring to avoid more than $5 million in U.S. anti-dumping duties by illegally importing Chinese-origin honey that was falsely identified as coming from South Korea, Taiwan, Thailand and India. This sentence resulted from an investigation conducted by the U.S. Immigration and Customs Enforcement (ICE) Office of Homeland Security Investigations (HSI).

Hung Ta Fan, aka Michael Fan, 40, was sentenced Nov. 5 in the Northern District of Illinois to 30 months in prison and was ordered to pay $5,378,370 in restitution. He pleaded guilty to the charges in August, pursuant to a cooperation agreement with the government.

Fan, a Taiwanese national, owned and operated multiple California-based honey import companies, including Blue Action Enterprise, 7 Tiger Enterprises, Kashaka USA, and Honey World Enterprise. He used these companies to fraudulently import Chinese honey into the United States. Fan admitted that between 2005 and 2006 he conspired with others to illegally bring into the United States 98 shipments of Chinese honey to avoid paying anti-dumping duties of about $5,378,370 due to the U.S. government.

The American Beekeeping Federation (ABF) had urged Federal Judge Elaine E. Bucklo to issue "the stiffest sentence that you are able to order."

Troy Fore, ABF government affairs director, wrote Judge Bucklo, "Our member beekeepers have been victimized by Mr. Fan and other individuals and companies. It is disheartening to read the documents that have been filed in the case. While our members and other American beekeepers toil to earn a living for their families and employees, Mr. Fan and his cohorts around the world schemed and planned to cheat them of the fruits of their labor.

"We also make this appeal on behalf of our many hard-working colleagues in the honey importing and processing sector with legitimate businesses who are finding their very existence threatened by conspiracies to avoid U.S. antidumping duties.  By ensuring that Mr. Fan is subject to a severe sentence, you will discourage Mr. Fan and others from engaging in such activities in the future."

"Mr. Fan and others deliberately mislabeled 98 shipments of honey in an effort to rob the U.S. government of more than $5 million in tariffs," said ICE Director John Morton. "Our domestic honey industry is economically threatened when importers illegally dump low-cost Chinese honey into the U.S. marketplace. This prison sentence sends a strong message domestically and internationally that ICE's Homeland Security Investigations aggressively investigates criminals who conceal the true origins of their products in the name of greed."

In his plea, Fan further admitted that in 2009 he conspired with others to fraudulently import about $8 million of honey that was diluted and blended with 20 to 30 percent artificial sugar. He admitted to adding artificial sugar to the honey in an effort to obtain a higher price and profit margin than if the shipments contained pure honey. Fan used his company Kashaka USA to bring in the diluted, blended honey.

Fan was arrested April 1 in Los Angeles as he arrived at the Los Angeles International Airport. He has remained in federal custody since his arrest. After serving his sentence, Fan will be turned over to ICE and placed into deportation proceedings.

Assistant U.S. Attorneys Andrew S. Boutros and William R. Hogan, Northern District of Illinois, prosecuted this case.

posted November 2010

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