At a House Appropriations Committee hearing prior to the Congressional recess, Rep. Rosa DeLauro (D-CT) questioned Attorney General Merrick Garland about crime and trade.
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NewsTranscript
00:00 And the chair recognizes the ranking member of the full committee, Ms. DeLauro.
00:06 A lot of hearings happening at the same time, but delighted that you're here this morning.
00:21 What I wanted to look at is the issue of crime, if you will, and trade.
00:30 DOJ plays a critical role in deterring crime through robust investigations, prosecutions, incarcerations, and the application of penalties.
00:41 My concern about DOJ, that there may be some serious blind spots and lack of resources in critical areas.
00:50 In particular, the U.S. international trade enforcement.
00:55 Example, 2022 U.S. imports were $3.27 trillion.
01:00 Conservative estimates based on available data from Economic Policy Institute projected 5 to 10 percent of those imports were fraudulent.
01:09 This means that there's annually $163 to $327 billion in illegal trade which impacts U.S. workers, manufacturers, consumers, and our free trade partners.
01:20 I understand DOJ's infrastructure to combat trade crimes is lightly resourced.
01:27 In 2022, U.S. Customs and Border Protection collected $19.4 million in penalties on $3.27 trillion of trade.
01:36 That seems to me to be a drop in the bucket.
01:38 I understand that international trade prosecutions are also low to non-existent.
01:44 A couple questions.
01:45 Can you give us a sense of DOJ resources you are using to prosecute these bad actors associated with crimes that violate trade laws?
01:53 How do you work with CBP and HSI to increase the number of prosecutions?
02:01 Would you say based on DHS enforcement data that combating international trade crime is a priority within DOJ?
02:08 Why or why not?
02:10 And how familiar are you with DOJ's efforts and resources dedicated to investigating and prosecuting international trade crimes?
02:18 What's your assessment of the department's actions, including the number of prosecutions and penalties?
02:24 Thank you.
02:26 You put your finger on an important risk to our economy, which is fraudulent trade goods.
02:33 That's why we have a trade fraud task force, which enhances collaboration between the Justice Department and the other agencies that you were discussing to investigate trade fraud.
02:45 It helped initiate more than 70 investigations involving hundreds of millions of dollars of fraudulently imported goods.
02:52 One good example is just last month.
02:55 The Ford Motor Company agreed to pay $365 million to settle customs civil penalty claims related to misclassified and undervalued items.
03:04 So I recognize the significance of this for our economy, and I believe our Justice Department task force is working well with other departments on this matter, including the Department of Homeland Security.
03:16 Do you have enough personnel to take on this issue and resources in a more robust way?
03:25 As I said, $3.27 trillion. We collect $19.4 million. That seems to be some great disparity.
03:33 I'm just asking, what do you need from us to be able to deal with this area on international trade, where we're getting killed?
03:45 The Justice Department will always like more money.
03:47 I understand that, but we need an assessment.
03:50 I think that the money that we're requesting for our Civil Division's Consumer Protection Branch, which deals with this kind of fraud, and our Criminal Division's Fraud Section, which deals with this on the criminal side,
04:04 and the U.S. Attorney's Offices that deal with this in each of the 94 districts, and the FBI's Corporate Crime and Fraud Sections.
04:15 Given the budget priorities, I think we're asking for the appropriate amount.
04:20 There's obviously always tradeoffs, but we are, I think, able to fund a robust program.
04:28 The most difficult aspect of this, of course, is identifying the fraudulent goods as they come in.
04:34 That really is a customs and, therefore, a homeland security issue.
04:38 I'm sure I would say the same to you, that they need more money for this purpose.
04:44 I'd like to pursue that. I'm just going to say something very quickly. I'm running out of time.
04:49 As you know, Antitrust Received, this is Antitrust Division, roughly a 4% increase in 2024, over the prior year.
04:59 I want to ensure that we can continue to justify these critical investments, protect consumers from unfair and anti-competitive business practices.
05:10 Do I have your commitment that we can work together?
05:13 I would like to work with you and with my staff on answering questions that we have on what resources the Antitrust Division,
05:21 and frankly, this could apply to all of DJG, DOJ, that you will need for 2025?
05:29 Yes, of course. We're very eager to speak with you about that.
05:33 The total we've requested is $288 million, which is an increase of $55 million over the enacted FY '24.
05:45 I will say I've always been concerned about this. I entered the Justice Department in 1979,
05:50 and we barely have more attorneys in the Antitrust Division now than we had in 1979.
05:57 I think this is the first year we've been able to bring the number up to the number of attorneys we had when I first entered the department.
06:04 But we'd like to work with you on how well we can track the resources that are necessary for you to be able to do your job.
06:12 And as a final comment, I'm very, very interested last night,
06:16 I listened to the FTC commissioner about the working together with DOJ because we have serious issues which affect consolidation,
06:29 which raises prices in this nation, makes anti-competitiveness a reality,
06:35 and how between DOJ and the FTC we can address these issues in a very, very robust, strong way to get at ending these monopolies,
06:48 if you will, that only increase prices for the American people.
06:52 Thank you very much. I yield back.
06:56 Chairman Adler, hold.
06:58 Thank you.