Earlier this year, I blogged about how new (changing) US tariff initiatives present challenges and opportunities for supply chain due diligence professionals. ArentFoxSchiff published an update on the customs and trade world that highlights how important supply chain due diligence continues to be:
“We are navigating an unpredictable and fast changing trade landscape and what we are reporting today may change by tomorrow (or in the next hour).”
Here is one part that got my attention:
“Recent reporting indicates a sustained ramp-up by the US Department of Justice (DOJ) in claims and enforcement under the False Claims Act (FCA) to pursue alleged tariff evasion tied to transshipment schemes… The FCA permits qui tam actions, meaning anyone, including private citizens, with knowledge of a potential violation can file suit on the government’s behalf. Additionally, under the FCA, the DOJ can recover penalties and triple the value of the government’s losses from the fraudulent transaction(s). This trend reflects a broader shift towards treating import-related statements as fraud, not just compliance errors, especially where transshipment may be involved.
In parallel, the US Customs and Border Protection (CBP) has awarded an exclusive and lucrative contract to Exiger AI to deploy artificial intelligence (AI)-driven transshipment detection across CBP. The platform is designed to score shipments in real time based on risk, map multi-tier supply chains, and validate origin, classification, and value…
Importantly, FCA exposure is in addition to CBP’s own penalty regime.”
I’ll reiterate what I said before:
If companies previously had a lot riding on supply chain due diligence results, the stakes today are off the charts. But this is good news for those in the business of supply chain due diligence. Their services have never been as directly impactful, financially material and valuable as they are now.
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