A Tacoma-based home goods business imported products from China that were falsely declared as being from Malaysia — a distinction that allowed it to evade specific oversight and more than $850,000 in import duties, according to the U.S. Attorney's Office.
Tip the Scale LLC, which operates LD Kitchen and Bath in the 1200 block of Puyallup Avenue, pleaded guilty Thursday in federal court to a felony count of importing goods by means of false statements. The company was ordered to pay $360,000 in fines and serve three years of probation, court records show.
Between January and May 2020, Tip the Scale imported five shipping containers of wooden cabinets and vanities that were declared as wood harvested in Malaysia but were actually harvested and produced in China, according to the U.S. Attorney's Office.
"By doing so, Tip the Scale evaded oversight of Chinese-harvested timber and more than $850,000 in import duties," the office said.
Under the Lacey Act, wood-product importers must file a declaration that details the genus and species of timber imports and the country in which the wood was harvested in an effort to prevent timber species that are protected, illegally logged or misdeclared from entering the United States.
In a statement, assistant attorney general Todd Kim called the Lacey Act "our best tool in combating timber trafficking."
Robert Hammer, a Homeland Security special agent in charge, said that the sentencing sent a clear message of accountability for companies that violate environmental laws and deceive customs authorities.
"By falsifying import documentation, L&D Kitchen and Bath sought to gain an unfair advantage over competitors and evaded important environmental protections," Hammer said in a statement.
LD Kitchen and Bath, as its name is stated on its website and in court records, is a woman- and minority-owned small business started in 2008 and run by friends and family, according to a sentencing memo filed in court June 6 by attorneys representing the company. It typically employs about 25 people.
"LDKB is a first-time offender. It had no intention to harm anyone," the memo said. "It failed to act with adequate care in completing importation paperwork about the species and origin of wood imported from a third party in a foreign country."
The memo said that the company had no importation department and only a general understanding of customs and trade laws, instead relying on third parties. The filing acknowledged that the business didn't have reasonable cause to believe the truth of particular statements in paperwork related to the species and origin of wood it imported from a third party in Asia.
Upon learning of the federal investigation, the company cooperated with the government and has since paid nearly $857,000 in duties and assessments and adopted a compliance plan to be audited by a government-approved auditor "to ensure such an incident never recurs," according to the memo.
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