Ceramic Importer Pleads Guilty to False Country of Origin Claims

Glen Ellyn, IL, April 3, 2024-"The U.S. Justice Department announced this week that it had accepted guilty pleas from an individual and corporate importer in Puerto Rico of ceramic tile for which they claimed the country of origin was Malaysia, when in fact the tile originated in China,” reports the Ceramic Tile Distributors Association. 

 “Akua Mosaics, Inc. and its president, Kenneth Fleming, reportedly have pled guilty to a conspiracy to smuggle porcelain ceramic into U.S. customs territory by falsely claiming that they were of Malaysian origin when instead, they were a product of the Peoples' Republic of China. The false claim of the tiles' origin apparently enabled the importers to avoid paying anti­ dumping duties of approximately 330.69%, countervailing duties of approximately 358.81%, and Section 301 duties of approximately 25% which are all applicable to imports of Chinese origin tile. Although Akua Mosaics is based in the Commonwealth of Puerto Rico, it is important to note that since the commonwealth is considered part of U.S. customs territory, importation of products into Puerto Rico is treated the same under the customs regulations as apply to the fifty states and District of Columbia.

 “Fleming and Akua Mosaics are said to have admitted conspiring with a citizen and resident of China. Between October 2021 and January 2022, these actions allegedly caused a container with porcelain tiles manufactured in PRC to be shipped from PRC to Malaysia where ‘Made in Malaysia’ labels were affixed to boxes of the Chinese-origin porcelain tiles manufactured in PRC that were shipped to Puerto Rico. The total amount of unpaid duties and tariffs on this shipment was approximately $1,090,000. According to the CBP press release, Fleming and Akua Mosaics face a maximum penalty of five years in prison, a $250,000 fine, a three-year term of supervised release, and a payment of $1,090,000 in restitution for the unpaid AD, CVD and Section 301 duties applicable to porcelain mosaic tiles that originate in China.”