May the Odds Be Ever in Their Favor? Not When Cheating on Tariffs!

A District 13 Level Conspiracy? More Like District 12 Ingenuity Gone Wrong

Alright people listen up. Seems like even after surviving the Hunger Games I can't escape shady dealings. Only this time it's not President Snow trying to poison me but Chinese exporters playing games with US tariffs. Apparently they're offering deals that sound too good to be true promising to cover all the import duties. And just like a Capitol stylist trying to make Peeta look menacing there's a whole lot of smoke and mirrors involved.

Under Invoicing: Because Apparently Lying on Paper Is Easier Than Spear Throwing

So how are they pulling this off? Under invoicing mislabeling…the whole shebang. They're basically saying a refrigerator is worth less than a loaf of bread. And just like in the arena these exporters are using shell companies – those ghost like businesses that pop up take the fall and disappear faster than you can say 'the odds are never in our favor'. These companies are set up just to take the blame when the tariff bills come due and they just shut down shop and open another one! It's easier than hunting a squirrel apparently. But I will still hunt the squirrel!

The 'Open Secret' Is Out: Even Peeta Knew Something Was Fishy

Ash Monga some supply chain guru calls it an 'open secret.' Sounds like the kind of thing Haymitch would know all about. Apparently opening a shell company is easier than making friends in the arena. “You can open as many companies as you want. The cost is a few hundreds so this whole process is easy to execute and can be replicated as many times as you want,” Monga added. US businesses desperate to save a buck because the Trump tariffs are even starting to push their Chinese suppliers to go down this dark path. It's a slippery slope folks like volunteering as tribute.

Risks Risks Everywhere: More Dangerous Than a Tracker Jacker Nest

Now here's the real kicker. American businesses are underestimating the risks. Thinking they can just wash their hands of it because they're not the 'importer of record'? Think again. Some lawyer Dan Harris says 90% of businesspeople think that but they're wrong and are not immune from civil or criminal liability. It is "a horrible game" for U.S. businesses complicit in this scheme as they could face substantial liability under the customs law and other laws like the False Claims Act. Sounds like President Snow’s idea of a fun afternoon. Even if they are paying pre tariff prices on imports from China and claiming ignorance of potential customs fraud it is unlikely that will stand as a credible defense Harris warned.

Cutthroat Competition: May the Best Cheater Win? (Spoiler: No One Wins)

So what happens when some businesses cheat and others don't? Cze Chao Tam some houseware CEO says it's tough to compete with the cheaters. "Consumers are most likely to choose the cheapest options and it will be very difficult to compete with people who do business illegally," Tam says adding that they're having a hard time negotiating prices with buyers because of the import duties. Trump's tariffs are a 'stress test' for U.S. Customs. There’s a "massive volume of trade coming in from China and other countries ... there just simply wouldn't be enough resources to be able to to screen them all." It's a mess folks. Like trying to untangle a fishing net after Prim gets a hold of it.

The Government Strikes Back: Hopefully With More Than Just Peacekeepers

But don't worry the government is 'on it.' Matthew Galeotti some Justice Department honcho is prioritizing trade and customs fraud. And Trump is saying he is taking in $2 billion a day from tariffs. The CBP is saying enforcement is being done through "a combination of legal authority advanced systems and operational procedures designed to ensure that duties owed are paid." They want to put pressure on other countries to enhance law enforcement efforts. Let's hope they can actually do something about it. Otherwise we're all just tributes in this messed up game. Remember folks "If we burn you burn with us!"