Stradley Ronon | U.S. Criminal Tariff Prosecutions in 2026: What International Businesses and Domestic Importers Need to Know

Key Takeaways

• Tariff evasion is now treated as a criminal offense in the United States rather than a compliance issue.
• Enforcement is expanding through coordinated investigations targeting practices such as transshipment and misreporting.
• Both U.S. and non-U.S. businesses must strengthen customs compliance and oversight to avoid significant legal and financial risks.

U.S. President Donald Trump’s use of tariffs in the global trade arena has helped push trade fraud to the top of the U.S. Department of Justice (DOJ)’s enforcement agenda. In December 2025, the DOJ announced that customs and tariff evasion had become a core white-collar enforcement priority. More recent statements from senior DOJ officials reinforced the same message: Trade fraud is no longer being treated as a niche customs issue and businesses should expect more criminal investigations and prosecutions in this area. As a result, international businesses and U.S. importers need to exercise particular care when it comes to customs compliance.

A Shift to Closer Scrutiny

For years, companies viewed tariff exposure primarily as a customs compliance problem that might lead to administrative penalties, audits or duty reassessments. In 2026, that view is no longer sound: U.S. authorities are increasingly approaching tariff evasion as potential criminal conduct, especially where they see evidence of intentional misstatements, transshipment (shipping goods through an intermediary country before they enter the United States), falsified documentation or efforts to disguise the true origin or value of imported goods. The risks now extend beyond the importer of record to any manufacturers, distributors, executives, compliance personnel and others involved in designing or approving import strategies.

International companies with U.S. imports, U.S. customers, U.S. affiliates, or supply chains that feed the U.S. market may now face a higher level of scrutiny. U.S. companies involved with imports also face exposure, especially for those operating in tariff-sensitive sectors, relying on complex sourcing structures, or using third-country assembly or routing arrangements. Businesses that receive document subpoenas or are approached by government agents for questioning need to treat those contacts as potentially critical law enforcement interactions.

Why Are Criminal Tariff Prosecutions Rising?

Several forces are driving the criminal enforcement trend. The first is the Trump administration’s broader America First trade posture. As the DOJ seeks to support that agenda, tariff evasion is more likely to be framed as critical conduct that harms U.S. manufacturers and undermines national trade policy, making criminal prosecution more likely.

Second, higher tariffs and more complex trade restrictions create stronger incentives for evasion. When tariff costs rise, so does the temptation to alter country-of-origin claims, reroute goods through third countries, understate the value of goods, manipulate tariff classification, or structure transactions to obscure the real nature of the import. Moreso, if industry competitors are benefiting by evading tariffs, those complying with the law become non-competitive, motivating even more evasion. As the economic stakes increase, so does the enforcement focus.

Third, DOJ officials have repeatedly and publicly reaffirmed that trade fraud is an enforcement priority. That matters because prosecutorial emphasis drives criminal investigations and prosecutions, and the messaging — a meaningful pipeline of investigations and a warning to expect more — suggests a sustained effort rather than a temporary campaign. For businesses involved with international trade, the practical implication is that compliance decisions once viewed as operational or technical are now more likely to be examined through a prosecutorial lens.

Enforcement Themes Emerging in 2026

The clearest theme so far in 2026 is the movement from isolated cases to DOJ priority. Rather than treating customs fraud as an occasional niche prosecution, the DOJ is signaling a coordinated and repeatable enforcement model. In mid-2025, the DOJ and the U.S. Department of Homeland Security (DHS) announced the creation of a joint federal Trade Fraud Task Force, signaling a coordinated effort among prosecutors and enforcement agencies to aggressively combat tariff evasion and the smuggling of prohibited goods. As we continue through 2026, expect to see prosecutorial dividends from that coordination in the form of more publicly filed cases.

Substantively, the focus is on classic customs crimes, especially false statements on entry and smuggling-related theories under federal law. That means investigators are looking at whether import documents were accurate, whether country-of-origin claims were truthful, whether valuation and classification were proper, and whether goods were imported through structures designed to evade tariffs or other trade restrictions.

As is often the case in corporate criminal enforcement, the DOJ’s public remarks are also meant to serve as deterrence. Recent corporate prosecutions are aimed at deterring illegal business conduct and the DOJ wants businesses to take note.

They also provide an enforcement blueprint going forward:

• Identify a tariff-sensitive product.
• Trace the import trail.
• Compare the entry narrative to the actual sourcing and movement of goods.
• Prosecute where the evidence suggests deliberate deception.

That approach makes criminal tariff enforcement simultaneously more predictable and more uncertain. It is more predictable because the government has publicly identified the conduct it is targeting. It is more volatile because the same fact patterns are common in global supply chains, particularly where pricing pressure, complex sourcing or supplier-driven logistics create incentives to oversimplify or distort import declarations, broadening the universe of possible criminal targets.

Recent High-Profile Criminal Tariff Matters

 Several high-profile matters illustrate the criminal tariff enforcement trend. In the Global Plastics matter from last December, a former chief operating officer (COO) of a global plastic resin distributor, MGI International LLC, pled guilty to conspiracy to smuggle goods into the United States. According to the DOJ, the COO directed employees to falsify the stated country of origin on customs entry forms for imports of plastic resin from China, thereby avoiding duties.

Notably, the DOJ declined to charge MGI, which voluntarily self-disclosed the conduct and cooperated with the DOJ’s investigation that led to the COO’s guilty plea. The matter reflects the DOJ’s emphasis on individual accountability, especially where senior personnel are alleged to have participated in or approved trade-fraud conduct, and its willingness to not charge corporate entities that cooperate with it.

In December, the DOJ alleged in the Ceratizit case that Chinese-made tungsten carbide products were routed through Taiwan in order to obscure their true country of origin. Ceratizit USA LLC, a North Carolina-based distributor of tungsten carbide products, agreed to pay $54.4 million to resolve False Claims Act (FCA) allegations that it knowingly failed to pay duties on products imported from China.

The DOJ characterized the resolution as the largest customs fraud recovery ever obtained under the FCA. The case is important because it captures one of the central theories in current tariff enforcement: transshipment. In these matters, the alleged scheme is not simply that goods entered the United States, but that they were routed through an intermediary country in order to obscure their true origin and reduce tariff exposure.

In these and other recent DOJ matters, even where the facts differ, the broader theories are consistent: origin fraud, transshipment, undervaluation, false statements on entry, and efforts to create a documentary record that does not match commercial reality. The DOJ is targeting deliberate country-of-origin misrepresentations, use of third-country intermediaries without meaningful transformation, reliance on false invoices or supporting documents, and executive-level involvement.

Likely Enforcement Trends for Remainder of the Trump Administration

Companies should expect more investigations and prosecutions targeting tariff fraud — not fewer. One clear trend is the increased use of tariff and customs fraud cases to support broader trade policy and protect domestic industry. The administration’s posture suggests that customs enforcement will remain tied to industrial competitiveness and the integrity of tariff measures. The focus on goods originating in China is purposeful.

Anticipate continued expansion of criminal investigations involving import practices, country of origin, valuation, tariff classification and supply-chain documentation. These are no longer secondary issues but central risk areas. Businesses should expect more scrutiny of how goods are sourced, how invoices are prepared, what claims are made to customs authorities, and whether internal records match what appears on entry documentation.

Interagency coordination is likely to deepen. The Trade Fraud Task Force appears to be part of a broader effort to bring together criminal prosecutors, customs authorities, and investigative agencies. That means cases may be built more efficiently, with information gathered through one channel feeding into another. Administrative customs inquiries may not be innocuous and may become criminal investigations more quickly than in the past.

Cases may increasingly be triggered by competitor complaints and third-party reporting. The DOJ has indicated that it is interested in hearing from domestic industries and others who believe competitors are gaining an unfair advantage through tariff evasion. This creates additional exposure in markets where pricing disparities or suspicious sourcing patterns are visible to competitors.

Whistleblower channels and internal reporting incentives are likely to become more important. As employees, former employees, counterparties and competitors gain more incentive to report suspected trade fraud, companies may see more investigations that begin not at the border, but through inside information. A successful whistleblower may receive a hefty bounty for bringing tariff fraud to the government’s attention.

What Does This Mean for Non-U.S. Businesses?

Companies domiciled outside the United States are not insulated from U.S. enforcement consequences. Those with U.S. imports, U.S. subsidiaries, or supply chains serving U.S. customers should assume that customs-related representations may receive closer review than before. The principal risk areas — country-of-origin representations, transshipment structures, tariff classification, customs valuation, and supply-chain and entry documentation — are now well defined. If a business cannot clearly explain where its goods are made, how origin was determined, why a particular classification was used, how value was calculated, and whether all supporting documents are accurate, it may face substantial risk.

In addition, risk extends beyond the formal importer of record to manufacturers, parent companies, distributors, sourcing teams, logistics personnel, customs brokers, and executives — all who may become relevant if they helped design, approve, or knowingly benefit from a false import structure.

What Steps Should Businesses Take Now?

Leaders of U.S. and non-U.S. companies should begin with an immediate review of import practices and customs controls. That review should not be limited to tariff classification but should also test country-of-origin determinations, valuation methodologies, invoice accuracy, routing structures, and the consistency of supporting documents across the supply chain.

Companies should also reassess origin certifications and supplier representations. Many businesses rely heavily on upstream supplier statements without sufficiently validating whether those statements are accurate under U.S. customs rules. In the current environment, that is increasingly risky.

Internal escalation protocols are equally important. If employees encounter proposals involving tariff engineering, unusual rerouting, invoice irregularities or unexplained origin changes, there should be a clear process for legal and compliance review. Silence, delay or compartmentalization can increase risk.

Finally, businesses should prepare for investigations initiated by whistleblowers, competitors or task force referrals. That means maintaining documentation, training relevant personnel, and ensuring that trade compliance is treated as a governance issue rather than a purely operational function. Employees should know what to do if they receive unsolicited interview requests from law enforcement agents, or if the business receives a subpoena demanding documents or other information.

Looking Forward

What was once largely seen as a customs compliance issue is increasingly being treated by the U.S. government as a criminal enforcement priority tied to trade policy and domestic industry protection. For international businesses and domestic importers, the takeaway is clear: U.S. customs compliance should now be treated as a criminal-risk issue, not just a trade operations issue.

Companies that import into the United States, sell into U.S.-facing supply chains, or rely on complex sourcing structures should act now to test their practices before prosecutors do it for them. And if businesses receive document subpoenas or employees are approached by government agents asking questions, those contacts should be treated from the start as potentially critical law enforcement interactions requiring experienced white-collar counsel.

By Steven D. Feldman, Partner, STRADLEY RONON STEVENS & YOUNG

 

 

Compliments of Stradley Ronon Stevens & Young – a member of the EACCNY