A Los Angeles County wholesale clothing executive was sentenced Friday to four years in prison for undervaluing imported garments by more than $32 million and failing to pay about $6.4 million in customs duties.
Mohamed Daoud Ghacham, 39, of Bell was also ordered to pay nearly $6.4 million in restitution, according to the U.S. Attorney’s Office.
Ghacham pleaded guilty in downtown Los Angeles in December 2022 to one federal count of conspiracy to pass false and fraudulent papers through a customs house.
The company — Ghacham Inc. — doing business under the name Platini, pleaded guilty to the charge of conspiracy to pass false papers and one count of conspiracy to engage in any transaction or dealing in properties of a specially designated narcotics trafficker under a statute known as the Foreign Narcotics Kingpin Designation Act.
This was the first criminal conviction in the district under the Kingpin Act, federal prosecutors said.
At sentencing last year, the company was ordered to pay nearly $10.4 million and placed on probation for five years for undervaluing imported garments in a scheme to avoid paying millions of dollars in customs duties and for doing business with a woman linked to Mexico’s Sinaloa drug cartel.
Ghacham Inc. was also ordered by U.S. District Judge Maame Ewusi-Mensah Frimpong in December to create and maintain an anti-money-laundering compliance and ethics program and submit to review by a third-party monitor, who will report to the court on an annual basis, according to the U.S. Attorney’s Office.
Documents filed in Los Angeles federal court show that Ghacham Inc. imported clothing from China and submitted fraudulent invoices to U.S. Customs and Border Protection that undervalued the shipments, allowing the company to avoid paying the full amounts of tariffs owed on the imports.
From July 2011 and February 2021, Ghacham Inc. and Mohamed Ghacham undervalued imported garments by more than $32 million and failed to pay nearly $6.4 million in customs duties, federal prosecutors said.
Ghacham Inc. also illegally conducted business with MarÃa Tiburcia Cazarez Pérez in violation of the Kingpin Act, which prohibits people and businesses in the United States from doing business with “specially designated narcotics traffickers,” according to the U.S. Attorney’s Office.
Cazarez Pérez was previously listed under the act for her involvement in the financial network of leaders of the Mexico-based Sinaloa Cartel.
“The company flouted the Kingpin Act, doing business with member of a money laundering network used by … two of the world’s most notorious drug traffickers,” prosecutors argued in a sentencing memorandum. “It cheated taxpayers out of millions, both to save itself money and to secure an unfair edge against its competition in the Southern California garment market. And it did so through a sustained, extensive effort over the course of more than a decade.”