Daily Court Reporter - News Former president of tire company indicted for fraudulently avoiding nearly $10 million in taxes
Former president of tire company indicted for fraudulently avoiding nearly $10 million in taxes
The former president of a Streetsboro company was named in a 51-count indictment for allegedly filing fraudulent paperwork to avoid paying nearly $10 million in taxes and tariffs, said Acting U.S. Attorney David A. Sierleja.
Indicted are: James Pearl, 61, and Doreen Pearl, both of Mt. Pleasant, South Carolina, and Shuang “Lucia” Liu, 32, of China.
They are charged with conspiracy to defraud the United States of America, entry of goods by means of false statement and smuggling goods into the United States.
James Pearl was president of Pro-Trac Tires LLC. Doreen Pearl was an employee of the company, located at 555 Frost Road in Streetsboro. The company was in the business of importing tires from China, India and other international suppliers. The company served as a middleman between the foreign supplier and domestic retailer, according to the indictment.
Liu worked for Qingdao Au-Shine Tyre Co. (Au Shine), a tire exporting company located in China. Liu was the point of contact for Au-Shine’s foreign accounts filled orders, coordinated exportation and received wire transfers of payments, according to the indictment.
The Commerce Department’s Anti-Dumping Order, amended in 2008, established import taxes on certain Chinese tires at a rate of up to 210 percent. But certain importers and manufacturers were given exemptions or lower tax rates.
From 2009 through 2013, the Pearls and Liu submitted fraudulent and altered invoices to Customs and Border Patrol to lower the taxable duty Pro-Trac was required to pay for importing tires from Au-Shine, according to the indictment.
Specifically, the Pearls and Liu presented fraudulent invoices and physically altered invoices to make it appear the tires were being shipped from companies that had exemptions, so Pro-Trac’s duty tax rate was lowered from 210 percent to 12.9 percent, according to the indictment.
By submitting approximately 176 false entry summaries, the U.S. was deprived of more than $9.7 million in revenue, according to the indictment.
The Pearls and Liu are scheduled to be arraigned in Ohio on July 12.
The matter is being prosecuted by Assistant U.S. Attorney Duncan T. Brown following an investigation by the Department of Homeland Security – Homeland Security Investigations.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the United States of America’s burden to prove each defendant’s guilt beyond a reasonable doubt.
If convicted, a defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendants’ prior criminal record, if any, the defendants’ roles in the offense and the characteristics of the violations.
Date Published: July 24, 2017