The U.S. Department of Homeland Security (DHS) executed a search warrant at an Ohio-based Chinese auto parts manufacturer amidst allegations of trade fraud, as lawmakers express concerns over tariff evasion.
Harco Manufacturing Group Raided
On January 21, DHS officers conducted a search at Harco Manufacturing Group in Moraine, Ohio, an auto parts maker with alleged ties to trade fraud.
Subsidiary of Chinese Firm Sunsong
Harco is a subsidiary of Sunsong, a Chinese parts manufacturer that acquired Harco in 2015. Both companies share the same listed address.
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Growing Concerns Over Tariff Evasion
Lawmakers in the United States are increasingly worried that certain Chinese companies may be circumventing U.S. tariffs. Reports from other news portals have highlighted this concern.
Ongoing Federal Investigation
According to a DHS spokesperson, the search at Harco Manufacturing Group is part of a continuing federal investigation.
Accusations Against Qingdao Sunsong
In September, the House Select Committee on the Chinese Communist Party wrote a letter to DHS Secretary Alejandro Mayorkas, accusing Qingdao Sunsong, a company affiliated with Harco, of relocating some of its production to Thailand to evade U.S. tariffs.
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Trade Fraud Allegations
The congressional letter pointed to Qingdao Sunsong’s public filings, which acknowledged the imposition of 25% U.S. import tariffs on certain Chinese-made goods.
Accelerated Production in Thailand
The company’s filings also indicated an accelerated production in Thailand as an effort to reduce tariff-related costs.
Catastrophic Impact on American Manufacturers
Republican congressmen Mike Gallagher of Wisconsin and Darin LaHood of Illinois, authors of the letter, described Sunsong’s actions as “blatant trade fraud” with severe consequences for American manufacturers.
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Transshipment as a Violation
The lawmakers stressed that using transshipment to evade U.S. tariffs constitutes a serious violation of U.S. law, undermining both American economic interests and national security.
Biden Administration’s Tariff Policies
The Biden administration has maintained many of the tariffs imposed by the Trump administration on Chinese imports, starting in 2018.
Unmet Commitments from China
China has failed to fulfill its commitments outlined in a 2020 trade deal with the United States. The agreement required China to increase its purchases of U.S. goods and services, a promise that remains unmet.
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