Federal authorities enforcing trade sanctions brought at the request of an Alabama hanger manufacturer have uncovered a multimillion-dollar, international conspiracy to circumvent duties on cheap Chinese imports, according to court documents.
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According to an indictment handed down by a federal grand jury this week, two men in California conspired to ship Chinese wire clothes hangers to the United States, move them to Mexico where they were stamped "Made in Mexico," and then ship them back to the United States for sale at prices that undercut U.S. manufacturers.
The alleged scheme was meant to circumvent duties levied on Chinese hangers by the U.S. government after Leeds-based M&B Metal Products complained in 2007 that Chinese manufacturers were "dumping" hangers on the U.S. market, or selling them below cost.
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