The U.S. is cracking down on customs evasion and customs fraud  

Customs Exemption Applications

The Department of Justice and CBP have their work cut out for them, as fraudsters carry out well-calculated schemes to evade customs duties and fees, often on a massive scale. For example, an Indonesian jewelry company was recently accused of carrying out a year-long scheme to avoid paying over $86 million in duties and fees on jewelry imports valued at $1.2 billion. Dishonest actors are creative when it comes to avoiding customs duties and, in practice, deceiving the authorities by:

The Strong Arm of the Law

As dishonest actors become bolder and more cunning in their attempts to evade customs duties, the authorities have stepped up their own efforts to combat fraud. The Department of Justice’s whistleblower program has proven to be an effective tool, leading to a 160 percent increase in the number of reports of alleged customs evasion during March–April 2025, compared to the previous year. 

Data Analysis and Artificial Intelligence 

In addition to whistleblower tips, U.S. authorities are increasingly using data analysis tools and artificial intelligence to conduct audits, detect anomalies, and investigate cases of customs evasion. For example, CBP uses AI to more effectively detect illegal transshipments in global supply chains. As the U.S. Department of Justice has stepped up its enforcement efforts, it has also intensified its work to combat violations of import regulations. Historically, CBP relied heavily on administrative measures such as fines, penalties, and settlements. Today, however, the Department of Justice has begun to address customs fraud in both civil and criminal courts, which means companies risk having to pay significant damages and fines amounting to millions of dollars. 

Faces severe penalties

Both companies and individuals—including executives, compliance officers, and customs agents—are closely scrutinized and are subject to criminal liability if systematic customs evasion is found. For example, executives at two companies have been indicted for selling forklifts of Chinese origin as ”Made in America” and undervaluing the cost of the equipment using false invoices. The aim was to avoid paying $1 million in duties, which could now result in long prison sentences and heavy fines. 

Reassessment of Compliance

With CBP’s closer scrutiny of compliance practices and stricter enforcement of violations, importers must improve their compliance strategies and systems—which, of course, also applies to all foreign companies, including Swedish ones, that engage in import activities in the United States. Manual attempts to evade duties—whether through ”creative” selection of HTS codes*, aggressive strategies to reduce duties that lack sufficient documentation, or complex and difficult-to-verify supplier structures — are now more likely than ever to be detected and challenged, leading to criminal, financial, and reputational damage.

Faster adaptation

In light of increasingly intense scrutiny, companies focused on trade and logistics must be able to adapt to rapidly changing tariffs and fine-tune their compliance in light of changes in country-specific, sector-specific tariffs, as well as punitive tariffs that can reshape cost structures overnight. Given that modern supply chains span multiple stages of production and countries, each with its own customs regulations, exemptions, and rules of origin, importers also need to understand all these complex cross-border rules and how they affect their own compliance.

Centralized tools are required

Given the complexity and uncertainty of today’s trade policies, importers who still rely on outdated compliance practices—such as manually looking up HTS codes—risk compromising their global trade operations and wasting time, effort, and money. To navigate today’s volatile global trade landscape—with its ever-changing duties and tariffs—compliance experts need to use centralized tools that combine accurate content with automated processes, flexibility, and robust tracking and auditing capabilities. By 2026, a centralized, automated, and documented HTS decision-making process will be a critical part of an importer’s compliance efforts. Integrated HTS code software —linked to ERP systems and to trade and customs systems—enables importers to accurately estimate shipping costs through comprehensive searches of HTS codes and precise calculations of total import costs. 

Complete visibility in the supply chain

To ensure transparency regarding the country of origin and the supply chain, full end-to-end visibility is absolutely essential. Verified bills of materials and clear evidence supporting origin and trade agreements are a necessity. Companies must also have automated tools to document how transfer pricing is calculated; to reconcile invoices, track payments, verify declared values, and monitor discrepancies. By analyzing data-driven reports, companies can verify the classification, valuation, and origin of goods and, over time, detect when something deviates from the norm.

More Resources for U.S. Customs

It is clear that the current U.S. administration’s efforts to combat customs evasion are not a short-term campaign. It is a strategic shift in how trade enforcement is resourced and carried out. Four billion dollars has been allocated to U.S. Customs and Border Protection (CBP) to recruit an additional 8,500 employees and pay substantial bonuses to customs officers. This, combined with the creation of the TFTF, the expanded whistleblower program, the increasing use of FCA (free carrier delivery of customs-cleared goods), and the increased use of criminal enforcement measures, all taken together, demonstrate that this is a long-term strategy. 

Now it's ”America First”

In 2026, the U.S. Department of Justice will focus on promoting the trade policy summarized by the phrase ”America First.” In this regard, customs evasion and fraud will be prevented through vigorous efforts to stop fraud related to country of origin, HTS classification, and declared commodity values. 

Proactive and flexible

To address these challenges, all importers need a proactive and flexible compliance strategy, supported by flexible trade compliance software that provides real-time global trade data and integrates due diligence/verification processes for procurement, purchasing, logistics, and partner selection. With the help of data-driven compliance systems, companies can defend and justify their decisions regarding classification, valuation, and country of origin while ensuring a smooth flow of goods, optimizing their customs costs, and realizing customs savings.