US targets buyers of China-bound cars

US federal prosecutors say the businessmen who re-export luxury cars from the United States to buyers in China are violating customs laws and deceiving auto manufacturers Mercedes-Benz and BMW, which try to keep tight control over sales to domestic dealers and to foreign countries.

In the past three years, the Chinese growing demand for Mercedes, BMW and Range Rover has created a lucrative business in a dozen of US states, where many businessmen sell the luxury cars to the companies which ship them to China, eventually.

According to a report by The New York Times, the cars, which typically retail for $55,000 to $75,000 in the United States, can be sold for as much as three times those prices.

“We’re taking advantage of a legitimate arbitrage situation,” Michael A. Downs, a businessman in Fort Lauderdale, Fla., was quoted by the Times as saying.

But federal prosecutors and agents with the Secret Service and the Department of Homeland Security has begun a broad crackdown on the export business since last yar.

Nearly 35,000 new luxury cars are re-exported to China from the United States each year.

Federal prosecutors in New Hampshire, New Jersey, Ohio, New York, Texas and South Carolina have filed criminal or civil actions seeking to put a halt to the resale of luxury cars to China, the Times said.

According to the newspaper, prosecutors have frozen bank accounts containing the proceeds from auto sales and seized hundreds of cars, some waiting to be shipped from cargo ports in Newark, Staten Island and Long Beach, Calif.

The US authorities have even ordered vehicles already on ships headed to China to be returned to port, the paper said,

The aggressive crackdown has raised concerns among many in the US, who believe the issue should be resolved through private litigation.

ARA/ARA

Source Article from http://www.presstv.ir/detail/2014/02/12/350319/us-targets-buyers-of-chinabound-luxury-cars/

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