China’s latest Scheme: “Honey Laundering”
After a nearly decade-long investigation, executives from six companies in China and Germany were arrested Wednesday and accused of conspiring to smuggle Chinese honey into the U.S. in an effort to avoid import duties.
The charges mark an end to what the U.S. government claims is the largest food smuggling case in American history.
“The charges allege that these defendants aggressively sought and obtained an illegal competitive advantage in the U.S. honey market by avoiding payment of more than 78 million dollars in antidumping duties, and while doing so deliberately violated U.S. laws designed to protect the integrity of our food supply,” Patrick Fitzgerald, United States Attorney for the Northern District of Illinois, said, according to AFP.
According to the allegations, a German company purchased low-cost honey from Chinese suppliers, filtered it through other nations to disguise its origin, and then sold it in the U.S., avoiding the steep anti-dumping duties on the Chinese product.
Some critics have referred to the practice as “honey laundering.”
“When I say ‘honey laundering’ I’m not talking about what Winnie the Pooh does to clean the honey off his clothes,” Sen. Amy Klobuchar (D-MN) told KARE-11 in Minneapolis. “Honey laundering is Chinese honey dumped on the U.S. market.”
Klobuchar said that the illegal smuggling scheme helped Chinese companies avoid roughly $200 million in anti-dumping duties each year. Because of an earlier ruling that found that China was illegally dumping its honey in the U.S. market, duties imposed on Chinese exports are $1.20 per pound. Other countries, some of which the honey was funneled though, have to pay duties as low as $0.02 per pound.
Not only did the companies game the system, defrauding the U.S. Treasury and putting American producers of honey in an extremely uncompetitive situation, but much of the honey imported from China was found to be tainted with antibiotics not approved in the U.S.
“I’m not trying to stop all honey imports,” Klobuchar said, according to KARE-11. “It’s just that customers have a right to know what’s in their honey and where it truly comes from.”
Although some of the honey contained antibiotics, Fitzgerald said that consumers should not panic. No illnesses have been reported due to the contaminated honey.
“There is no allegation and no reason to believe that any of the honey involved in this case had led to any injury or illness,” he said.
According to the allegations, from 2002 to 2009, 606 illegal shipments originating from China were seized.















