Auto parts importer sentenced to 15-month term for fraud

November 06, 1993|By Marcia Myers | Marcia Myers,Staff Writer

A federal judge sentenced the former president of an auto parts company to 15 months in prison yesterday for his role in a customs fraud that cost the government $2.3 million in lost duties and tariffs.

Heinz K. Wolfmaier pleaded guilty in August, and his firm, Cleveland-based Sachs Automotive Products Co., agreed to pay $4.5 million in duties and fines to avoid prosecution.

A two-year investigation by the U.S. Customs Service in Baltimore revealed that the company evaded duties on more than 200 shipments of automobile bearings it imported from Germany and Japan.

The bearings are subject to stiff customs duties, and Wolfmaier falsified records to conceal their importation.

Assistant U.S. Attorney Ira Oring said the case underscores the plight of the U.S. bearing industry. "The industry is dominated by the Germans and Japanese -- this has a direct impact on American jobs," he said.

But Wolfmaier's attorney, Max Lauten, argued that nothing Wolfmaier did hurt the U.S. bearing industry. "No U.S. manufacturers were harmed, and it's questionable how much dumping was in fact going on," he said.

Wolfmaier said he did not believe the clutch-release bearings his company imported qualified for the "anti-dumping" duty. The duty requires importers to pay 70 percent of the value on certain products to prevent foreign manufacturers from dumping the goods in the United States at less than fair market value.

He acknowledged, however, that he should have paid the duty first and then challenged the government on whether it should have been imposed.

"Never did I believe it would come to the point of me being here today," Wolfmaier told the judge.

U.S. District Judge Frederick J. Motz said that Wolfmaier may not have set out to commit a crime but that he had no right to skirt the law merely because he believed the parts were not subject to duties.

The 15-month sentence was less than the two years the government had requested. Judge Motz also sentenced Wolfmaier to one year of supervised probation and ordered him to pay a $6,000 fine.

Special Agent Robert Trader, who investigated the case for the Customs Service, said evidence of obstruction surfaced in a letter he discovered in Sachs' files. The letter instructed a Japanese supplier to falsify records about the type of goods it was shipping or else lose Sachs' business.

The company is a division of Fichtel and Sachs Industries Inc., a subsidiary of Fichtel & Sachs A.G., a German corporation that is a key manufacturer of the bearings.

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