A Warning for Importers: A CBP Prior Disclosure Does Not Count for DOJ

On October 1, 2026, DOJ’s National Fraud Enforcement Division issued Directive 26-12, which makes commerce fraud a company enforcement precedence and lists ten elements prosecutors should weigh in deciding whether or not to cost an organization. In latest remarks, a authorities official added some extent each importer ought to hear: a previous disclosure filed with CBP doesn’t depend as a voluntary self-disclosure for DOJ functions. Importers, their executives, and the businesses that purchase from them, now face a devoted DOJ commerce fraud part, data-driven lead technology, and a pointy deal with nation of origin. 

KEY TAKEAWAYS 

• DOJ’s National Fraud Enforcement Division issued Directive 26-12 on October 1, 2026, itemizing customs-related fraud as certainly one of 4 company investigation priorities and naming ten elements prosecutors should place nice weight on when deciding whether or not to cost an organization. 

• A CBP prior disclosure shouldn’t be a voluntary self-disclosure to DOJ. DOJ’s Corporate Enforcement Policy states that disclosures made solely to regulatory businesses typically don’t qualify. 

• Country of origin fraud is the main sample. The authorities official mentioned greater than half of the commerce fraud circumstances over the previous yr concerned nation of origin. 

• Never submitting an entry with CBP shouldn’t be a protection. Earlier this yr, an organization pleaded responsible and paid a $6,382,000 wonderful for getting imported plywood it knew(or was willfully blind to the truth that it was), was illegally imported, although it was not the Importer of Record. 

DOJ Has Built a Dedicated Trade Fraud Program 

DOJ introduced on July 14, 2026 that the Trade Fraud Task Force had handed $1 billion in recoveries and charged losses, created the Global Trade & Commerce Enforcement Section throughout the National Fraud Enforcement Division, and launched A Resource Guide to Trade Fraud Enforcement with DHS. We summarized the information in DOJ and DHS Publish Comprehensive Trade Fraud Enforcement Guide. 

Directive 26-12 builds on that construction. Section III directs Fraud Division prosecutors to prioritize 4 classes of company investigations, the fourth being fraud schemes involving tariff evasion, importation of products or companies, or compelled labor. The directive additionally requires prosecutors to report ongoing company investigations to the Division’s Corporate Enforcement Section inside seven days of its issuance. It doesn’t prolong to circumstances assigned to a District Fraud Counsel by a U.S. Attorney’s Office that the Fraud Division doesn’t additionally supervise. 

In their remarks, the federal government official described a number of themes that body how DOJ is approaching commerce circumstances: 

• Whole-of-government enforcement. The Task Force attracts on DHS, CBP, HSI, IRS, EPA, the Fish and Wildlife Service, FDA, NOAA, CPSC, and different companions, and is working with the Inspector General neighborhood. 

• CBP’s shift. The official described CBP as shifting from a facilitation mission towards a compliance mission and a zero belief mannequin, and acknowledged {that a} change of that scale doesn’t occur in a single day in an company of CBP’s measurement. His message to firms was to know their provide chain. 

• Where leads come from. He recognized information analytics by way of the Fraud Division’s detection and concentrating on work, qui tam False Claims Act fits, referrals from different businesses and from opponents, and whistleblowers. 

• Criminal expenses are growing. He mentioned DOJ shouldn’t be making an attempt to create a paper tiger and that prison commerce fraud expenses have elevated in 2026. 

The Ten Factors Prosecutors Must Weigh 

Under Section III of Directive 26-12, Division personnel “should place nice weight” on the next elements in deciding whether or not to convey expenses and in negotiating plea or different agreements. The right-hand column is DTL’s evaluation, not DOJ steering.

The directive calls these elements a non-exhaustive checklist. Prosecutors might think about another related issue according to the Justice Manual and shall additionally observe and implement the Department-wide Corporate Enforcement and Voluntary Self-Disclosure Policy (CEP). 

Country of Origin Is the Leading Fraud Pattern 

The authorities official recognized nation of origin fraud, together with transshipment, as a top-tier enforcement space and mentioned greater than half of the commerce fraud circumstances over the previous yr concerned nation of origin. He additionally flagged undervaluation and the obligation of candor to CBP. Recent DOJ issues present the sample.

The official additionally addressed product engineering. An organization that adjustments an enter to vary a product’s important character, and with it the nation of origin, ought to anticipate scrutiny. In his view, good actors work with regulators to know what’s required and are candid about it. Our country of origin apply web page covers the foundations that govern these determinations. 

You Do Not Have to File an Entry to Have a Problem 

Earlier this yr, an organization that was not the importer of document, a customs dealer, or a freight forwarder, and by no means handled CBP pleaded responsible to a felony violation of the Lacey Act. According to DOJ, it purchased plywood from the importer, Horizon Plywood, that it knew, or was willfully blind to the truth that it had been illegally imported, and it saved ordering after a search warrant was executed at Horizon’s warehouse. Internal communications additionally confirmed that the corporate knew of the importer’s wrongdoing. 

The Resource Guide additionally discusses 18 U.S.C. § 545, which reaches anybody who receives, buys, sells, or facilitates the sale of merchandise after importation realizing it was imported opposite to legislation. The authorities official famous that legal responsibility underneath that provision can embody forfeiture of the products in addition to prison expenses.  The importer of document stays chargeable for truthful declarations to CBP. 

DTL’s learn: distributors, retailers, and different purchasers of imported items ought to deal with provider pricing and origin crimson flags as their very own compliance problem, not the importer’s. 

A CBP Prior Disclosure Does Not Count for DOJ 

A previous disclosure underneath 19 C.F.R. § 162.74 can cut back civil penalties underneath 19 U.S.C. § 1592. It is a CBP civil penalty mechanism. Under the CEP, the Department will decline to prosecute an organization that voluntarily self-disclosed misconduct to an acceptable Department prison element, absolutely cooperated, and well timed and appropriately remediated, absent aggravating circumstances. 

The CEP states that disclosures made solely to federal regulatory businesses, state and native governments, or civil enforcement businesses typically don’t qualify. However, good religion disclosures to these entities might qualify if acceptable underneath the circumstances, on the Department’s discretion, and in all circumstances could also be thought-about as a part of an organization’s cooperation and remediation. 

The authorities official was direct on this level. He mentioned a CBP prior disclosure doesn’t depend for DOJ functions. He framed the CEP as a coverage for voluntarily disclosing against the law, famous {that a} mistake shouldn’t be against the law, and suggested firms to err on the facet of bringing DOJ in. Asked when an organization ought to think about each a CEP disclosure and a previous disclosure, he mentioned that if the conduct rises to the extent the place an worker can be terminated, the corporate ought to consider disclosing. 

DTL’s learn: for a classification or valuation error made in good religion, a prior disclosure to CBP stays the first instrument. Where the info embody realizing conduct, concealment, or conduct critical sufficient to self-discipline or terminate an worker, the DOJ query needs to be determined earlier than the CBP submitting. Under the CEP, a disclosure qualifies as voluntary provided that the misconduct was not beforehand identified to the Department and the disclosure got here earlier than an imminent risk of disclosure or authorities investigation. 

What DOJ Looks for in a Compliance Program 

The authorities official mentioned DOJ is cautious to not be prescriptive about compliance applications and isn’t reinventing its requirements. He pointed firms to current company enforcement resolutions to see how DOJ analyzes the elements, and described what issues: 

• Tone on the high, and tone within the center. Lead consumers and provide chain officers matter, not solely senior executives. 

• Controls calibrated to the corporate’s precise danger. 

• Consistent compliance. He referenced a Seventh Circuit choice for the purpose that complying with the legislation 99 % of the time doesn’t excuse the opposite 1 %. 

• Forced labor diligence. He referred to as compelled labor a significant focus, addressed in chapter 4 of the Resource Guide. See our forced labor steering. 

His message for the C-suite: not talking with CBP doesn’t imply an organization doesn’t have a problem. The CEP’s definition of well timed and acceptable remediation features a root trigger evaluation, an efficient compliance program, acceptable self-discipline, and retention of corporate affairs data, together with controls on private and ephemeral messaging purposes. 

Action Items for Importers and Their Buyers 

The following are DTL’s suggestions, not necessities of the directive or the CEP. 

1. Audit nation of origin first. Review origin declarations, provider adjustments, and any latest shift in sourcing nation in opposition to manufacturing data. This is the place DOJ says most circumstances come up.
2. Decide the disclosure path earlier than submitting something. If the info recommend realizing conduct, have counsel assess a DOJ self-disclosure underneath the CEP earlier than or alongside a CBP prior disclosure.
3. Use the termination take a look at. If an inner assessment would lead you to self-discipline or terminate an worker, deal with that as a sign to guage a possible DOJ voluntary disclosure.
4. Bring buying into compliance. Train lead consumers and provide chain officers on origin and pricing crimson flags. Document why the corporate accepted any provider it questioned.
5. Answer CBP utterly. Responses to CBP Form 28 requests, CBP Form 29 notices, and customs audits needs to be correct and full. Concealment is among the ten listed elements.
6. Preserve data now. Implement retention controls overlaying messaging apps earlier than an inquiry arrives. 

For background on how civil customs points change into prison issues, see Compliance Mistakes Can Turn Criminal and The Largest Customs Fraud Settlement from the DOJ Trade Fraud Task Force: $549.5 Million. 

How Diaz Trade Law Can Help 

Diaz Trade Law represents importers and provide chain firms in CBP enforcement issues, prior disclosures, Section 1592 penalties, and commerce investigations. If your organization is weighing a disclosure, responding to a CBP inquiry, or reviewing an inner report, contact us at 305-456-3830 or [email protected]. 

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