Wade Smith is an importer of live exotic snakes which are in compliance with Fish & Wildlife Regulations. Upon an independent audit of books and records, the auditor discovers $20,000 in assists that Wade paid to his suppliers but did not report to Customs. Wade tells his auditor that he knew he should have reported it but decided that Customs would never find out. Upon the auditor’s advice, Wade reconsiders and files a prior disclosure with Customs covering the $20,000 in assists. The prior disclosure satisfies all of the requirements under 19 CFR 162.74 and 19 U.S.C. 1592(c) (4). Customs determines that Wade Smith’s culpability level is fraud and that there is no loss of revenue. Which ONE of the following correctly states the maximum penalty that Customs can levy against Wade Smith?
A) Ten percent of the dutiable value of the merchandise.
B) The domestic value of the merchandise.
C) One times the loss of duties, taxes, and fees.
D) The interest due on the loss of revenue.
E) Forty percent of the dutiable value of the merchandise.
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The Answer is: A
Citation: 19 CFR 162.73(b)(1)(ii)
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