Governor Cuomo Updates New Yorkers on State's Progress Combating COVID-19 - JULY 28, 2021

 

26,063 Vaccine Doses Administered Over Last 24 Hours

7 COVID-19 Deaths Statewide Yesterday 

 Governor Andrew M. Cuomo today updated New Yorkers on the state's progress combating COVID-19. 

"There's no doubt that the Delta variant is real - you can see it in the numbers - but we have been through this before and we know how to keep it under control," Governor Cuomo said. "The vaccine is the weapon that will win the war against COVID, and to get our vaccination rates up even more and protect New Yorkers from the Delta variant we are now requiring all patient-facing health care workers in state hospitals to get vaccinated by Labor Day. All State workers will also be required to get vaccinated, and those who do not will be required to be tested for COVID-19 on a weekly basis. It's smart, it's fair, it's in everyone's interest and it will put us one step closer to defeating this beast once and for all."

Today's data is summarized briefly below: 

• Test Results Reported - 98,944 
• Total Positive - 2,203 
• Percent Positive - 2.23% 
• 7-Day Average Percent Positive - 2.04% 
• Patient Hospitalization - 591 (+6) 
• Patients Newly Admitted - 111 
• Patients in ICU - 126 (+8) 
• Patients in ICU with Intubation - 50 (+5) 
• Total Discharges - 186,488 (+9) 
• Deaths - 7 
• Total Deaths - 43,068
• Total vaccine doses administered - 22,109,711 
• Total vaccine doses administered over past 24 hours - 26,063
• Total vaccine doses administered over past 7 days - 228,019
• Percent of New Yorkers ages 18 and older with at least one vaccine dose - 72.0% 
• Percent of New Yorkers ages 18 and older with completed vaccine series - 66.5% 
• Percent of New Yorkers ages 18 and older with at least one vaccine dose (CDC) - 74.8% 
• Percent of New Yorkers ages 18 and older with completed vaccine series (CDC) - 68.2% 
• Percent of all New Yorkers with at least one vaccine dose - 60.1% 
• Percent of all New Yorkers with completed vaccine series - 55.3% 
• Percent of all New Yorkers with at least one vaccine dose (CDC) - 62.6% 
• Percent of all New Yorkers with completed vaccine series (CDC) - 56.7% 

Leader Of New Rochelle Drug Trafficking Organization Sentenced To More Than 7 Years In Prison For Distributing Cocaine

 

 Audrey Strauss, the United States Attorney for the Southern District of New York, announced that ULYSSES LOPEZ was sentenced today by U.S. District Judge Nelson S. Román to 87 months in prison for leading a drug trafficking conspiracy that distributed kilograms of cocaine out of a grocery store located in New Rochelle, New York.  LOPEZ pled guilty before U.S. Magistrate Judge Judith C. McCarthy on August 27, 2020. 

Manhattan U.S. Attorney Audrey Strauss said: “Today’s sentence sends a message that destructive drug trafficking in our communities will not be tolerated.  We will continue to work with our law enforcement partners to keep our neighborhoods free of addictive and dangerous narcotics.”

According to the allegations in the Indictment, and statements made in court filings and during court proceedings:

From April 2018 up to October 2018, ULYSSES LOPEZ, together with six charged co-defendants, conspired to distribute five kilograms and more of powder cocaine.  LOPEZ was the leader and organizer of the drug trafficking conspiracy, which operated out of several buildings in the vicinity of, and including, the SuperMercado Mexico located in New Rochelle, New York, which was owned and operated by LOPEZ and his father and co-defendant, Valentino Lopez (“Valentino”). 

After being arrested, and while detained at the Westchester County Jail, LOPEZ attempted to obstruct justice by encouraging one of his charged codefendants, Felipe Barajas, to provide false statements to the Government regarding their relationships and Barajas’s use of his residence to store cocaine on LOPEZ’s behalf.  

Six of the charged defendants, including LOPEZ, Valentino, and Barajas, have pled guilty and been sentenced.  Valentino was sentenced on June 25, 2021, to 60 months in prison for his role in the drug trafficking conspiracy.  The seventh defendant remains a fugitive. 

In addition to his prison sentence, LOPEZ, 41, of New Rochelle, New York, was sentenced to four years of supervised release, and forfeiture of $150,000 and a Mercedes Benz ML350.

Ms. Strauss praised the excellent work of the Federal Bureau of Investigation and the Drug Enforcement Administration.

Senator Rivera on Restrictive Excluded Workers Fund Regulations Put Forth by Governor Cuomo's Department of Labor

 

 "Earlier this year, the Legislature reached a historic agreement to create a first-in-the-nation $2.1 billion Excluded Workers Fund (EWF) as there was a clear understanding that undocumented workers across the State desperately needed direct financial relief after being denied access to any government relief for more than a year. Now, Governor Cuomo and his administration are restricting the Fund's accessibility to effectively exclude the workers the program is designed to help, similar to the challenges that tenants are facing in accessing the state's rent relief program. This is not the first time this administration tries to bypass the Legislature's authority to create unnecessarily limiting regulations that disregard or override the intent of the law. It is time for the Governor to stop playing absurd and obscene games with the livelihoods of New Yorkers. His administration must ensure that the program's requirements, as well as the application process, are designed to reach our State's hardest-hit communities, which have already experienced too much loss. We need to do better for every New Yorker looking for help from their state as we recover." 

PUBLIC ADVOCATE RELEASES MID-YEAR ANALYSIS OF NYC'S WORST LANDLORDS

 

 Public Advocate Jumaane D. Williams announced the findings of the first-ever mid-year analysis of the Worst Landlord Watchlist, a supplement to the annual list which is intended to demonstrate the regression and/or progression of the landlords featured. 

For the mid-year analysis, Department of Housing Preservation and Development (HPD) Housing Maintenance Code Violations were tracked from December 2020 to May 2021 in order to follow developments at these buildings since the original inclusion on the Worst Landlord Watchlist.

Across all buildings on the watchlist, there was a 2.65% decrease in the average number of open violations when comparing the mid-year analysis average and the 2020 watchlist average.

These results, while preliminary, could indicate that some of the worst landlords are taking steps toward repair at their most egregious buildings. However, historical data also indicates that spring and summer months show a reduction in violations generally, as frequent issues such as heat and hot water outages become less prominent. The 2021 list, released in December, will demonstrate a more complete picture of progress or regression by property owners featured.  

"The findings of our mid-year analysis are encouraging, suggesting that at least some landlords on the list have responded to their placement on it by attempting to resolve open violations," said Public Advocate Jumaane D. Williams. "At the same time, these six months do not tell the whole story, and this analysis does not account for every bad action. Every violation that remains represents an issue faced by a tenant in our city. If landlords on the 2020 watchlist are able to sustain and expand on this progress across their portfolios, their standing should improve next year- and most importantly, tenants will see the benefits in their homes."

From December 2020 to May 2021, among the top five worst landlords on the 2020 list, these were the results of the analysis:

• Jason Korn had an average of 1137 open violations per month, a 37.60% decrease across buildings featured on the list
• Lewis Barbanel had an average of 1172 open violations per month, a 15.26% decrease across buildings featured on the list
• Robert Raphael had an average of 1123 open violations per month, a 8.62% decrease  across buildings featured on the list
• Abdul Khan had an average of 1183 open violations per month, a 1% decrease across buildings featured on the list
• David Blau had an average of 912 open violations per month, a 4.2% decrease across buildings featured on the list

While rankings from the 2020 list are not affected by this analysis, the mid-year assessment offers an opportunity for New Yorkers to see whether bad actors have allowed conditions to stagnate or further deteriorate, spotlighting any changes in conditions of featured buildings - though it does not provide insight into the rest of a landlord's portfolio. 

This information empowers tenants to put pressure on bad landlords to more urgently address conditions. It also encourages landlords to improve, presenting an ongoing opportunity for owners operating in good faith to show progress by addressing conditions at their buildings. Landlords will remain in their existing ranking until the new list is released at the end of each calendar year.

Public Advocate Williams also urged tenants to use the resources available to them to correct bad conditions within their buildings, including reporting issues to the city, saying, "Too often tenants suffer in silence instead of employing the tools at their disposal when landlords are unresponsive or problems are persistent. By filing a complaint with 311, tenants create a record of a building or unit issue and increase the urgency of resolving it."

The Public Advocate is currently advancing the Worst Landlord legislative package, which includes measures to expedite HPD' response to immediately hazardous violations and to prevent landlords from self-certifying that a violation has been resolved.

MAYOR DE BLASIO ANNOUNCES LOW-COST BROADBAND ACCESS FOR ANOTHER 10,000 NYCHA RESIDENTS IN THE BRONX

 

Bloc Power to make high-speed internet access available for up to 10,000 residents in five Bronx NYCHA developments

 

Major milestone in Internet Master Plan for Universal Broadband

 Mayor Bill de Blasio and New York City Mayor’s Office of the Chief Technology Officer (MOCTO) John Paul Farmer announced today a major milestone in the City’s effort to bring new internet connectivity options to New York City Housing Authority (NYCHA) residents and to create a shift in the local broadband market. As part of New York City’s implementation of the Internet Master Plan for Universal Broadband, the City of New York and NYCHA have executed agreements with a sixth vendor: New York City based internet service provider, Bloc Power, to offer high-speed internet access for up to 10,000 residents in five NYCHA developments in the Bronx.

 

The developments include Melrose, East 152 Street-Courtlandt Avenue, Forest, Morris I, and Morris II. Access to broadband for residents who sign up will be free for the first year and $15/month beyond.

 

“Building a recovery for all of us means giving New Yorkers the tools they need to stay connected, at prices they can afford,” said Mayor Bill de Blasio. “Expanding access for another 10,000 NYCHA residents will make our city fairer and more accessible for generations of New Yorkers, and I’m proud to see the Internet Master Plan deliver for communities who need it the most.”

 

“As COVID-19 has increased our dependency on Internet access, it has further exposed the inequity of resources available in our Black and Brown neighborhoods. Universal broadband is a lifeline for the communities hardest hit by COVID-19, affecting their connections to employment, education and financial tools,” said First Lady Chirlane McCray. “This expansion means that more New Yorkers will have access to remote learning, telemedicine and new opportunities for employment in the 21st century economy.”

 

“With every additional New Yorker who gains access to affordable, high-speed internet, we bring this City one step closer to being the fairest, most equitable big city in the country,” said Deputy Mayor for Operations Laura Anglin. “We celebrate this additional deployment of broadband in the Bronx, bringing thousands of residents consistent connection to the digital world.” 

 

Bloc Power is the sixth finalist selected from the City’s Request for Expressions of Interest (RFEI) issued in partnership with the NYC Economic Development Corporation (EDC) in June 2020. This effort is part of the Mayor's commitment to extend broadband to New Yorkers in the hardest-hit communities identified by the Taskforce on Racial Inclusion and Equity. The first five licensing agreements will increase access for up to 30,000 residents, bringing the total number of residents with increased broadband options due to the RFEI to up to 40,000.

 

“This announcement is part of the first phase of moving the Internet Master Plan for Universal Broadband from bold vision to New Yorkers’ everyday reality,” said John Paul Farmer, Chief Technology Officer for the City of New York. “Bloc Power will bring affordable internet connectivity to 10,000 residents in the Bronx, illustrating just how powerful partnerships between the public and private sectors can be when they are founded on principles that prioritize what New Yorkers really need: equity, performance, affordability, privacy and choice.” 

 

“This pandemic has highlighted the need for broadband access in every corner of the city, especially where children need to learn and folks need the option to work safely,” said NYCEDC President and CEO Rachel Loeb. “Bringing high-speed Internet access to all New Yorkers is key to making the city more equitable and economically more viable.”

 

“The infrastructure of our buildings, public spaces, and common areas is interwoven into the fabric of New York City. It’s significant that we are able to leverage these assets by working with partners like Bloc Power to provide free and reduced-cost internet service options,” said Eva Trimble, New York City Housing Authority Executive Vice President for Strategy & Innovation. “Expanding opportunities through broadband access is a central part of our mission to supporting the economic mobility, public health, and public safety of our residents.”

 

This RFEI offered a unique opportunity for internet service providers, both large and small, to propose their plans and partnership ideas to use new access to NYCHA buildings and facilities to rapidly close the digital divide for this slice of New Yorkers. Respondents proved that when the City offers new assets – including building common areas, facades, rooftops, light poles, and other physical structures that can be used for broadband installation – a diverse set of companies will enter the market with lower cost service options that compete with large companies offering limited high-quality service options to New Yorkers. These new companies prove that you can bring new connectivity options to public housing communities and to low-connectivity neighborhoods to close the digital divide.

 

In the target neighborhoods, internet service providers charge anywhere from $40/month to $110/month. With this RFEI, vendors will provide free or low-cost internet service residents can sign up for no more than $20/month.

 

“We are excited to support the City's leadership in closing the digital divide and creating employment opportunities for underserved communities,” said Keith Kinch, General Manager and Co-Founder of Bloc Power. “We are delighted to kick off the installation phase of this project and bring WiFi to hundreds of thousands of families in the South Bronx.”

 

About the Internet Master Plan

 

In January 2020, the City announced the New York City Internet Master Plan, a first-in-nation plan that provides the roadmap to universal broadband in New York City, and the steps the City will take to close the digital divide. Providing equitable broadband is vital to ensuring economic prosperity, digital inclusion, and full participation of all New Yorkers in the digital economy. Universal broadband will also pave the way for next generation technologies such as 5G to be fully accessible to all New Yorkers.

 

“The pandemic showed us that broadband access in the 21st century should not be viewed as a privilege for a select few that can afford it, but instead should be a universal right for all New Yorkers. For many of our historically underserved communities, the digital divide persists and is a constant obstacle to success. This new partnership with Bloc Power will ensure that thousands of NYCHA residents in the Bronx have equitable access to high-speed internet and is a step forward towards achieving universal broadband access for those that need it the most in our city,” said Council Member Vanessa L. Gibson.

 

"Free broadband Internet for public housing has been a dream of mine for more than a decade and 10,000 residents at 5 NYCHA developments in the Bronx will be getting it for the next year," said Council Member Ben Kallos. "Congratulations to Mayor de Blasio and CTO John Paul Farmer on getting this done for tens of thousands of public housing residents."

 

Governor Cuomo Announces Sweeping $125 Million Debt Relief Program for at Least 50,000 Students

 

'CUNY Comeback Program' Earmarks Funding to Eliminate Outstanding Balances Accrued During the Pandemic

One of the Nation's Largest Student Debt Forgiveness Plan of its Kind, Enables Students to Push Forward in Pursuit of Educational and Career Goals

 

 Governor Andrew M. Cuomo today announced the CUNY Comeback Program, a sweeping plan to eliminate up to $125 million in unpaid debt for at least 50,000 students who attended CUNY and suffered financial hardships during the COVID-19 pandemic. The initiative is one of the nation's largest student debt forgiveness plan of its kind. Additionally, students who did not accrue unpaid tuition and fee balances during the period but experienced financial hardship stemming from the pandemic will receive relief in the form of enhanced Student Emergency Grants. The CUNY Comeback Program will be funded through federal stimulus assistance allocated to CUNY.

"The COVID-19 pandemic has caused hardships in the lives of so many New Yorkers, and our students were among those most impacted," Governor Cuomo said. "This landmark new program eliminates millions of dollars in unpaid debt, providing much-needed relief to tens of thousands of CUNY students as they work to get back on their feet after the pandemic and plan for their futures."

Many CUNY students come from communities that were the hardest hit by the pandemic and its resultant economic fallout. During the pandemic, students' debt to CUNY nearly doubled. The objective of the CUNY Comeback Program is to remove financial barriers to access the education New Yorkers of limited means need to move up the economic ladder.

"CUNY students showed their great resilience in the face of the immeasurable hardships they faced over the past 16 months, from employment and income loss to food and housing insecurity, amid an unprecedented health crisis that brought sickness and tragedy to thousands of New York families," said CUNY Chancellor Félix V. Matos Rodríguez. "This compassionate action will allow CUNY students and recent graduates to move ahead in pursuit of their educational and career objectives without the specter of unpaid tuition and fees. This landmark measure will also enhance CUNY's important contributions to New York's economic recovery."

At its meeting on July 6, the CUNY Board of Trustees approved the use of $125 million in federal stimulus funds for student support and retention, including this student debt relief initiative. While final numbers are unknown until student eligibility and hardship applications have been fully assessed, the University estimates that at least 50,000 students will receive a pandemic debt-relief benefit. The average debt balance is about $2,000. As of August 2020, more than two-thirds of undergraduate students, or 69.2 percent, attend tuition-free. Three in four undergraduate students graduated debt-free.

Eligible students who were enrolled at the University from March 13, 2020, the date the coronavirus was declared a national emergency, through the Spring 2021 semester and accrued tuition and fee balances during that time, will have those unpaid debts to the University wiped clean. This action covers the Spring, Summer and Fall 2020 semesters and the Spring 2021 semester, including students who have graduated. It is a one-time action to aid students who faced and overcame numerous difficulties during the public health and economic crises. In most cases, outstanding student balances will be cleared without an application process, allowing students to register for Fall semester classes and obtain their official transcripts.

The program will be funded through federal stimulus assistance allocated to CUNY through the Higher Education Emergency Relief Fund of the Coronavirus Response and Relief Supplemental Appropriations Act in December 2020 and President Biden's American Rescue Plan Act, which was passed by Congress in March.

Eligibility Criteria

Tens of thousands of students who meet the below criteria will automatically have their eligible tuition and fees forgiven in August 2021. These are the criteria to be applied:

1. Students determined to have hardship, using criteria similar to what CUNY employed to allocate federal Student Emergency Grants in Spring 2020 and Spring 2021. This includes any student who was eligible for Pell Grants, based on their Expected Family Contribution as provided after completing the FAFSA, even if the student did not receive Pell. This may also include students who are eligible for the New York State Tuition Assistance Program but did not meet eligibility requirements for the maximum award.
2. Students who graduated from CUNY since the national emergency was declared on March 13, 2020 and owe any outstanding balance from Spring 2020 through Spring 2021.
3. Students who have an outstanding balance of $100 or less per semester, for any of the Spring 2020, Summer 2020, Fall 2020 and Spring 2021 semesters.

Thousands of other students who accrued debt during the aforementioned semesters, but were not eligible for financial aid, may have their unpaid debt forgiven by applying based on financial hardship. CUNY campus financial aid offices will review those requests to determine eligibility. Hardships may include the need to pay medical expenses not covered by insurance; unusually high childcare costs; being homeless or a dislocated worker; recent unemployment of a family member on whom they depend for support; food or housing insecurity; or other changes in the family's income or assets that rendered them unable to pay off their liability to CUNY.

In order to assist students who paid all or some of their tuition and fee charges out of pocket between the Spring 2020 and Spring 2021 semesters and do not owe any amount to CUNY for that period, all such students who are eligible for federal Student Emergency Grants may receive an additional $200, on top of any other Student Emergency Grant allocation that the student will be entitled to in Fall 2021.Those students may also be eligible for aid from the Chancellor's Emergency Relief Fund and campus-based aid programs.

The City University of New York is the nation's largest urban public university, a transformative engine of social mobility that is a critical component of the lifeblood of New York City. Founded in 1847 as the nation's first free public institution of higher education, CUNY today has seven community colleges, 11 senior colleges and seven graduate or professional institutions spread across New York City's five boroughs, serving 500,000 students of all ages and awarding 55,000 degrees each year. CUNY's mix of quality and affordability propels almost six times as many low-income students into the middle class and beyond as all the Ivy League colleges combined. More than 80 percent of the University's graduates stay in New York, contributing to all aspects of the city's economic, civic and cultural life and diversifying the city's workforce in every sector. CUNY's graduates and faculty have received many prestigious honors, including 13 Nobel Prizes and 26 MacArthur "Genius" Grants. The University's historic mission continues to this day: provide a first-rate public education to all students, regardless of means or background.

Manhattan U.S. Attorney Settles Civil Fraud Lawsuit Against Clothing Companies And Their Former CEO For Misrepresenting The Value Of Goods To Avoid Paying Customs Duties

 

Defendants to Pay $6 Million and Admit to Engaging in Fraudulent Schemes Involving Use of False and Inaccurate Invoices

 Audrey Strauss, the United States Attorney for the Southern District of New York, Peter C. Fitzhugh, the Special Agent in Charge of the New York Office of Homeland Security Investigations (“HSI”), and Marty Raybon, Acting Director, Field Operations, New York, U.S. Customs and Border Protection (“CBP”), announced today that the United States has settled civil fraud claims brought under the False Claims Act against STARGATE APPAREL, INC. (now named EXCEL APPAREL CORP.) (“STARGATE”), RIVSTAR APPAREL, INC. (“RIVSTAR”), and JOSEPH BAILEY.  Stargate and Rivstar are apparel companies headquartered in New York, New York, and BAILEY is the companies’ former CEO and owner.   As alleged in the Government’s lawsuit, filed in 2019, BAILEY, STARGATE, and RIVSTAR employed a variety of schemes to defraud the United States by submitting invoices to CBP that falsely understated the true value of the clothing that they imported into the United States in order to avoid paying millions of dollars in customs duties.  RIVSTAR is no longer operating.

Under the civil settlement approved today by U.S. District Judge J. Paul Oetken, BAILEY will pay $3.2 million to the United States, and STARGATE, RIVSTAR, and the employee stock ownership plan that currently owns the companies will together pay a total of $2.8 million to the United States.  BAILEY, STARGATE, and RIVSTAR admitted and accepted responsibility for their conduct as further described below.  As part of the settlement, STARGATE and RIVSTAR (to the extent that it resumes operations) will also implement a written compliance policy that will include measures designed to ensure that they pay duties on the full, actual value of all future imports and otherwise comply with applicable customs laws and regulations.  Last year, BAILEY pled guilty and was sentenced to six months in prison for engaging in certain of the conduct related to STARGATE imports that is at issue in the Government’s civil complaint.  This civil settlement is in addition to the $1,661,617 forfeiture amount that BAILEY was ordered to pay in the criminal proceedings. 

U.S. Attorney Audrey Strauss said: “Stargate, Rivstar, and their former president engaged in a variety of fraudulent schemes to short-change the Government of customs duties owed for imported clothing by falsely under-reporting its value.  This settlement, along with the separate criminal action against Bailey, demonstrate that our Office will hold companies, as well as their executives, accountable when they try to evade paying the legally required custom duties on imported goods.”

HSI Special Agent in Charge Peter C. Fitzhugh said: “For over a decade these clothing companies used ‘double-invoice’ schemes to underpay customs duties that were owed to the U.S. for garments being imported into the country, resulting in millions of dollars in customs duties lost.  HSI worked closely with U.S. Customs and Border Protection and the U.S. Attorney’s Office for the Southern District of New York to achieve this settlement, requiring the defendants not just to accept responsibility, but also to pay the Government $6 million and enhance their compliance policies.”

CBP Acting Director of New York Field Operations Marty Raybon said: “The settlement reached today is a testament to the dedication of our partners in the United States Attorney's Office, Homeland Security Investigations, and the men and women of CBP in enforcing our nation’s trade laws and punishing those perpetrating this type of fraud.”

The Government’s complaint alleges that in order to avoid customs duties, from 2004 through 2015 (the “Covered Period”), STARGATE, RIVSTAR, and BAILEY engaged in two types of “double invoicing” schemes to fraudulently underpay customs duties owed to the United States in connection with the garments that they brought into the country.  Under the first scheme, the exporter would provide one invoice that reflected the amount Defendants actually paid the exporter for the goods, and a second invoice that fraudulently reflected a fabricated lower amount that was submitted to CBP.  These two invoices were virtually identical (e.g., same invoice number, description of goods, quantity of goods), except that they included different prices for the same shipments of goods.  Under the second scheme, the exporter also would provide two invoices, which together reflected the actual price paid for the shipment.  However, Defendants would only submit one of the invoices to CBP.  The other invoice, which purported to be for “samples,” “accessories,” “commissions,” or “testing costs,” reflected an additional payment made by Defendants for the same goods described in the first invoice and was not submitted to CBP.  The purpose of each of these two schemes was the same – to fraudulently under-report the value of the goods in order to pay less duties.   

As part of the settlement, BAILEY, STARGATE, and RIVSTAR admit, acknowledge, and accept responsibility for the following conduct:

STARGATE Conduct:

• During the Covered Period, Stargate’s primary supplier was Taizhou Jiali Garments Co. Ltd. and its affiliated manufacturers (collectively, “Taizhou”), which are all located in China.  At the direction of BAILEY, STARGATE engaged in two different fraudulent schemes that involved the preparation and use of false and inaccurate invoices to underreport the actual value of goods imported from Taizhou in order to avoid paying the customs duties due.  BAILEY knew that this conduct was wrong and in violation of customs laws.
• As part of the first scheme, from 2007 through 2010, at BAILEY’S direction, Taizhou provided STARGATE with two sets of invoices for each shipment of goods.  One invoice, referred to in email communications as the “pay by” invoice, reflected the actual price paid by STARGATE for the goods.  The second invoice reflected a fake, lower price for the goods and was the invoice that STARGATE presented to CBP through its customs broker.  Stargate, at the direction of Bailey, routinely declared this false, lower value on CBP entry forms in order to pay lower customs duties on goods imported from Taizhou.
• Beginning around 2010 and continuing through at least 2015, BAILEY and STARGATE engaged in a second scheme.  At BAILEY’S direction, Taizhou provided two separate sets of invoices for a given shipment that together reflected the true price Stargate actually paid for the goods.  The first invoice, typically entitled the “commercial invoice,” described the goods purchased, and was submitted to CBP by STARGATE’s customs broker.  The second invoice purported to reflect amounts paid by Stargate for “sample” goods and was not submitted to CBP.  The “sample” invoice was not, in fact, for samples actually purchased by STARGATE.  Rather, STARGATE used the “sample” invoice to make an additional payment to Taizhou for the goods purchased by STARGATE that were described in the “commercial invoice,” while hiding the full value of those goods from CBP.  STARGATE, at the direction of BAILEY, routinely declared only the values recorded on the “commercial invoices,” which were less than the full price paid for the goods, on CBP entry forms in order to pay lower customs duties on goods imported from Taizhou.
• During the Covered Period, STARGATE also imported goods that it purchased from Tex-Prime International, Ltd., and its affiliated manufacturers (collectively “Tex-Prime”), which are located in China.  Beginning in at least 2004 and continuing through 2014, STARGATE, at the direction of BAILEY, also engaged in two different fraudulent schemes that involved the preparation and use of false and inaccurate invoices to underreport the actual value of goods imported from Tex-Prime in order to avoid paying the customs duties due.
• The first scheme involved Tex-Prime providing two nearly identical invoices for each shipment that differed only in the stated price.  The first invoice reflected the amount that STARGATE actually paid for the imported goods.  The second invoice (frequently identified by a “C” suffix following the invoice number, or the term “Custom” following the invoice number in the file name), reflected a false and inaccurate lower price and was the invoice that STARGATE submitted to CBP through STARGATE’s customs broker.  STARGATE, at the direction of BAILEY, routinely declared the values recorded on this second, false invoice on CBP entry forms in order to pay lower customs duties on goods imported from Tex-Prime.
• The second scheme also involved Tex-Prime providing two invoices.  In this scheme, the two invoices together reflected the actual price paid by STARGATE for the shipment.  The first invoice, entitled a “commercial invoice,” described the goods purchased and was submitted to CBP by STARGATE’s customs broker.  The second invoice, entitled a “statement,” purported to be an invoice for accessories charges, commissions, testing charges, or samples.  This second invoice was not submitted to CBP and in reality reflected an additional payment made by STARGATE to Tex-Prime for the same shipment.  STARGATE, at the direction of BAILEY, routinely declared only the values recorded on the “commercial invoices,” which were less than the full price paid for the goods, on CBP entry forms in order to pay lower customs duties on goods imported from Tex-Prime.
• Through the practices described above, STARGATE misrepresented the value of the goods it purchased and imported into the United States.  STARGATE and BAILEY were aware at all times that the reported information was incorrect and grossly understated the actual value of the imported goods, but continued to make the incorrect entries in order to reduce the amount of duties owed.  As a result of their conduct, STARGATE and BAILEY underpaid customs duties that were due and owing to the United States. 

RIVSTAR Conduct:

• During the Covered Period, RIVSTAR imported goods purchased from Pacific Potential Trading Co., Ltd., and its affiliated entities (together, “Pacific Potential”), as well as from Dongguan Bestsign and Trading Co., Ltd., and its affiliated entities (together, “Bestsign”), all of which are located in China.
• During the Covered Period, at RIVSTAR’s request and BAILEY’s direction, Pacific Potential and Bestsign provided two sets of invoices for each shipment imported into the United States by RIVSTAR.  The first invoice described the goods imported and was submitted to CBP by RIVSTAR’s customs broker.  The price reflected on the invoices declared to Customs did not reflect the full price RIVSTAR paid for the merchandise.  The second invoice purported to be for “testing costs” relating to the imported goods and was not submitted to CBP.  Together, the two invoices reflected the true total price that RIVSTAR paid for the goods; RIVSTAR, however, did not declare the amount reflected on the invoice for “testing costs” to CBP.  For the most part, the amounts reflected on the invoice for “testing costs” were not for actual testing, but instead reflected an additional payment made by RIVSTAR to Pacific Potential and Bestsign for the same shipment that was not declared to CBP.  To the extent that any such payments actually related to testing costs, such charges were still dutiable and should have been declared to CBP. 
• Through these practices, RIVSTAR at BAILEY’s direction misrepresented the value of the goods it purchased and imported into the United States.  RIVSTAR and BAILEY were aware at all times that the reported information was incorrect and grossly understated the actual value of the imported goods, but continued to make the incorrect entries in order to reduce the amount of duties owed. As a result of their conduct, RIVSTAR and BAILEY underpaid customs duties that were due and owing to the United States.

The conduct in this matter was first brought to the attention of federal law enforcement by a whistleblower who filed a lawsuit under the False Claims Act.

Ms. Strauss thanked U.S. Customs and Border Protection and Homeland Security Investigations for their assistance with the case.