Auto Broker to Pay $430K to Settle Charges Over Undervalued Car Imports

Washington state-based auto broker BidBuy Auctions settled a customs fraud case with DOJ, agreeing to pay $430,000, the U.S. Attorney's Office for the Western District of Washington announced. The qui tam case saw a former BidBuy employee allege the auto broker lied to CBP about the value of imported vehicles to pay less in duties. As a result of the settlement, the former employee-turned-whistleblower will get 23%, or $98,900, of the $430,000 payment.

According to the U.S. Attorney's Office, the duties on foreign-made light trucks jumped in 2020 when the U.S. left NAFTA to enter the USMCA. Starting July 1, 2020, the duties on these cars jumped to 25% of their value at the time of import. BidBuy allegedly lied about the value of the trucks to avoid these increased duties, the U.S. Attorney's Office said Feb. 7.

For instance, BidBuy allegedly bought a 2011 Dodge Ram truck in Canada for $22,494, telling CBP that its value was just $9,638, saving around $3,214 on duties. The whistleblower said that more than 80 vehicles were undervalued to CBP. Under the settlement, BidBuy does not admit to any wrongdoing.

“This conduct doesn’t just cheat the government out of revenue, it gives the business an advantage not enjoyed by other auto brokers who report their vehicle values honestly,” U.S. Attorney Nick Brown said. “This is an expensive lesson for BidBuy -- one that could have been avoided if it followed the rules.”