MIAMI – A Florida husband and wife were both sentenced last week to 57 months in prison for illegally importing wood products and evading approximately $42 million in duties.

According to a press release issued by the U.S. Department of Justice, Noel and Kelsy Hernandez Quintana each pleaded guilty last October to conspiring to import plywood in violation of the Lacey Act and customs laws, and to selling plywood products that were illegally imported and sold. Noel Quintana also pleaded guilty to one count of smuggling and one count of violation the Lacey Act. Kelsy Quintana also pleaded guilty to two counts of violating the Lacey Act.

In addition to their prison sentences, the Quintanas were ordered to pay, jointly and severally, $42,417,318.50 in forfeitures, plus $1,630,324.46 in storage costs of illegal wood seized by the government. Their employee, Marta Angelbello, was sentenced to 90 days probation and fined $3,000.

According to court filings, the Quintanas and Angelbello engaged in a sophisticated scheme to evade antidumping and countervailing duties of up to 200 percent owed on hardwood plywood products made in China by falsely declaring the species, country of origin or country of harvest of the wood from which the plywood was made. At times they caused containers of plywood to be shipped from China to Malaysia or Sri Lanka, for example, where the wood was taken out of the original containers and put into a second set of containers to conceal the Chinese origin of the product. 

The Quintanas incorporated seven companies in the United States – naming relatives or friends as corporate officers and agents – and used these shell companies to import hundreds of shipments of plywood products into the United States between February 2016 and December 2020. The Quintanas also incorporated a financial shell company through which they accepted payments from purchasers for the plywood they imported in violation of law, including the Lacey Act and customs laws. The DOJ said the wood products had a market value of $25 million to $65 million.

When importing plant products, the Lacey Act requires filing a declaration which contains, among other things, the plant’s scientific name and its country of harvest. 

After being alerted to the possibility of prosecution for their illegal acts, the Quintanas fled the United States initially to Panama and then to Montenegro where they were the subject of extradition proceedings. Facing up to 20 years in prison, each of the Quintanas entered into a plea agreement. According to that agreement, softwood plywood – regardless of country of export – carried a general duty of 8%, with a few duty-free exceptions, such as if the outer ply was made from Parana pine. Antidumping and countervailing duties of more than 200% applied to hardwood plywood manufactured in China after approximately April 2017.

Before April 2017, the Quintana’s importing shell companies imported containers of plywood into the United States and almost exclusively declared them to be hardwood plywood imported from China. But after April 2017, the companies evaded applicable duties by falsely declaring their hardwood plywood imports from China to be either the product of another country or to be made with a species of wood not subject to duties.

For example, a declaration from July 2018 said plywood in three containers was manufactured in Russia. But the containers were manufactured and loaded in Qingdao, China, and transported to Port Everglades, Florida, through the Panama Canal, without ever stopping in Russia. After federal authorities stopped such a shipment through Panama, the Quintanas used a different tactic to evade duties by shipping Chinese-produced hardwood plywood to Malaysia and transferring the wood to new containers to be shipped onward to the United States. This change of containers was intended to better conceal that the plywood originated from China. 

“The enforcement of customs laws serves an integral part of U.S. foreign policy and trade policy,” said U.S. Attorney Markenzy Lapointe for the Southern District of Florida. “In this case, the defendants undermined U.S. policy by evading legally mandated customs duties on plywood manufactured in China using Russian timber. Moreover, by doing so, the defendants covered up their criminal scheme to violate federal environmental law, while also unjustly enriching themselves. This case shows the importance of prosecuting customs and environmental offenses.”