This False Claims Act settlement resolved a customs fraud case brought by the Relators against Selective Marketplace Ltd. , a United Kingdom retailer of premium womenswear merchandise under two brands, Wrap London and Poetry. While Selective Marketplace is an English registered company with headquarters in England, it regularly shipped merchandise from the United Kingdom directly to thousands of U.S. customers.
Importers of goods into the United States are generally subject to paying import duties, including duties on packages with an aggregate fair market value over a certain de minimus amount. For example, in 2016, packages with a value under $200 could enter the United States duty free.
The Relators, and the United States who intervened in the case, alleged that Selective violated the False Claims Act, 31 U.S.C. §§ 3729(a)(1)(C) and (G) (called the Reverse False Claims provision), by improperly and knowingly concealing and avoiding United States Customs import duties applicable to the Wrap London and Poetry merchandise Selective was shipping to its U.S. customers.
It did so by splitting single orders with an aggregate value of greater than $200 into multiple packages for shipment so that each package fell below the minimum value subject to import duties. This type of customs fraud is called structuring. This not only deprived the U.S. Treasury of import duties, it undermined domestic American competitors whom the customs law was meant to protect. To resolve these allegations, Selective Marketplace agreed in May 2019 to pay the United States $610,000.
United States ex rel. Relators v. Selective Marketplace Ltd. et al., Civil Action No. 2:17-cv-380-LEW (D. Maine)