Majors

Temple St. Clair to Pay Government $796K+ in Customs Case

MajorsJun 27, 2018

Temple St. Clair to Pay Government $796K+ in Customs Case

A former inventory manager for the jewelry brand blew the whistle on the company, claiming it was not paying what it should in import duties.

New York--Jewelry brand Temple St. Clair has agreed to pay the U.S. government nearly $800,000 after settling a suit involving failure to pay customs duties and  inventory that was not properly marked.

A former inventory manager for the jewelry brand was the one who brought the case under the False Claims Act. The act allows whistleblowers, also known as relators, to file a lawsuit on behalf of the government to recover money an individual or business has avoided paying to the United States. If the government successfully recovers the money, then the whistleblower receives a portion of that recovery.

The ex-employee filed her complaint in the U.S. District Court for the Southern District of New York against Temple St. Clair LLC and three individuals--jewelry designer and brand founder Temple St. Clair Carr; her husband and brand President Paul Engler; and Vice President of Sales Jamie McGrath--in June 2015.

The settlement was filed June 21. It and the original suit were unsealed the following day. (Suits brought under the False Claims Act are required to be sealed in order to protect the investigation.)

According to court documents, the whistleblower was responsible for preparing customs documents for the import and export of jewelry and loose gemstones during her time at Temple St. Clair. Her complaint outlined several schemes allegedly undertaken by the jewelry brand to evade or underpay U.S. customs duties.

In addition, the U.S. government filed a complaint-in-intervention, which allows a third party to join the plaintiff in a complaint, containing similar allegations.

The complaint alleges that between 2011 and 2017, Temple St. Clair LLC underreported the value of goods imported from Italy, Sri Lanka and Thailand; obtained duty-free treatment on some imported jewelry that didn’t qualify; and failed to declare to Customs and Border Protection jewelry brought into the U.S. for commercial purposes, thereby unlawfully avoiding payment of customs duties.

The complaint also stated that the company, “failed to affix permanent markings to jewelry manufactured in Sri Lanka or Thailand identifying the jewelry’s country of origin” when it entered the U.S., then sold the jewelry to retailers without any markings indicating country of origin.

(Title 19, U.S. Code, Section 1304 requires jewelry be permanently marked with the country of origin at the time of import.)

According to Sanford Heisler Sharp, the law firm that represented the whistleblower, the case is thought to be the first in New York in

which money was recovered for the U.S. government based on the defendant’s failure to properly mark its products with their country of origin.

Temple St. Clair LLC admitted to and accepted responsibility for failing to pay customs duties, both in court papers and in a statement emailed to National Jeweler Tuesday.

Engler said in the brand’s statement to National Jeweler: “For over 30 years, Temple St. Clair has designed, created and shipped tens of thousands of pieces of jewelry throughout the world, including to and from the United States, Europe, and Asia. Our global operations have required us to learn and adhere to multiple countries’ complex regulations regarding import duties and country of origin marking. Despite our careful compliance, United States Customs claimed that we had misinterpreted some regulations, and, in particular, a United States trade preference program.”

He said the allegations “represented a small piece of (their) business” and they cooperated with the investigation and found the government to be correct.

Engler added that the government found no evidence of intentional wrongdoing and that the brand, in addition to paying the money owed, will further identify and apply best practices and policies to make sure all future import duties are accurately calculated and paid.

“As we move forward with those initiatives, we have been and continue to be proud to support and nurture some of the best artisanal goldsmiths in the world and to bring timeless jewels of uncompromising craftsmanship and materials to our clients,” the statement concluded.

U.S. District Judge Katherine Polk Failla awarded a judgment of $796,000 to the U.S. government, as well as post-judgment interest at the rate of 12 percent per year compounded daily.

In addition, Temple St. Clair agreed to affix permanent markings identifying country of origin to all its jewelry going forward.
Brecken Branstratoris the senior editor, gemstones at National Jeweler, covering sourcing, pricing and other developments in the colored stone sector.

The Latest

Asian Star’s diamond manufacturing facility in India
SourcingMar 27, 2024
Compliance, Caution, and Concern: The Current Outlook of Indian Diamantaires

There is a willingness to comply with new government-mandated regulations, with an insistence that they should be practical and realistic.

Kira Diam solar plant
Lab-GrownMar 27, 2024
Indian Lab-Grown Diamond Manufacturers Keep Growing

A combination of factors is driving growth in the industry despite the precipitous drop in prices across the board.

Bharat Ratnam, a Mega Common Facilitation Centre (CFC)
SourcingMar 27, 2024
Reinvigorating SEEPZ, the Epicenter of India’s Studded Jewelry Exports

The zone’s modernization will enhance and increase India’s jewelry manufacturing capabilities while aiding small and mid-sized businesses.

Jewelers of America Fly In Washington, D.C.
Brought to you by
How Jewelers of America Represents Your Business

For over 30 years, JA has advocated for the industry, fought against harmful legislation and backed measures that help jewelry businesses.

SRK Empire and SRK House
Policies & IssuesMar 27, 2024
SRK Exports’ Journey Toward Net Zero Impact

By the end of this year, SRK’s diamond manufacturing complexes will achieve net zero emissions, one of an impressive array of achievements.

Weekly QuizMar 21, 2024
This Week’s Quiz
Test your jewelry news knowledge with this short test.
Take the Quiz
Georgia May Jagger Tommy Hilfiger ad campaign
FinancialsMar 27, 2024
Movado’s Full-Year Sales Sink 11%

The company plans to invest $25 million in marketing initiatives to boost awareness around its namesake and licensed brands.

Hand holding shopping bags
SurveysMar 27, 2024
Consumer Confidence Held Steady in March

Optimism about the current state of the economy was offset by anxiety around inflation and the political environment.

BTYB-HoBrothers-updated.png
Brought to you by
The Scalable, Professional, and Effortless Solution for High-Demand Custom Jewelry Retailers

Ho Brothers offers scalable solutions for the future of custom jewelry.

Bernadette Mack
Policies & IssuesMar 27, 2024
Mercury Free Mining Hires Bernadette Mack

The former WJA executive director is MFM’s new managing director.

April Is Diamonds Do Good Month
Policies & IssuesMar 27, 2024
Diamonds Do Good Announces Its April Initiative

DDG encourages retailers to educate customers on the positive impact of purchasing natural diamonds.

National Jeweler columnists Duvall O’Steen and Jen Cullen Williams
ColumnistsMar 26, 2024
Creative Connecting: AI Tools and Tips for Social Media

Jen Cullen Williams and Duvall O’Steen explore how jewelers can save time and money by using AI to analyze engagement and create content.

Interior of Miami Lakes Jewelers
IndependentsMar 26, 2024
Miami Lakes Jewelers to Close After 37 Years

The Florida store’s owner Miguel Gonzalez is retiring.

 International Gemological Institute
GradingMar 26, 2024
IGI Announces Tech for ID’ing Lab-Grown Colored Diamonds

The lab stresses the importance of accurate identification, as the difference in price is “substantial.”

Kendra Scott lab-grown diamond jewelry
CollectionsMar 25, 2024
Kendra Scott Debuts Lab-Grown Diamond Fashion Jewelry

The brand also plans to expand its retail footprint from 138 to 200 stores over the next three years.

Instappraise logo NAJA logo
Events & AwardsMar 25, 2024
NAJA, Instappraise Offering Scholarships for Aspiring Jewelry Appraisers

One is reserved for a NAJA member, the other for a non-member.

Carie Lehrke and Megan Mattice
MajorsMar 25, 2024
Borsheims Announces New VP of HR, Assistant Manager

Longtime employees Carie Lehrke and Megan Mattice have received promotions.

My Next Question graphic vintage jewelry webinar
Recorded WebinarsMar 22, 2024
Watch: How to Buy and Sell Vintage Jewelry

Three guests joined National Jeweler and Jewelers of America to discuss trending time periods, spotting reproductions, and more.

Chris Clipper and Robert Lepere
MajorsMar 22, 2024
David Yurman Announces New CFO, Chief People Officer

Chris Clipper and Robert Lepere join the company with 50 years of combined experience.

Nakard pyrite earrings
CollectionsMar 22, 2024
Piece of the Week: Nakard’s Pyrite Earrings

The trendy, metallic earrings wink at classic spring colors.

Stock image of police cars with their lights on
CrimeMar 21, 2024
Sparks Fly as Burglars Lose Safe on California Freeway

JSA said a man and woman pulled the safe out of an Oakland jewelry store but couldn’t quite get it into their van.

Grizzly Mining rough emeralds
SourcingMar 21, 2024
Grizzly Sells 4,145-Carat Emerald for Over $1M

The miner’s March auction generated $19 million.

Helen McCluskey
MajorsMar 21, 2024
Signet Jewelers Names New Board Chair

Helen McCluskey will succeed H. Todd Stitzer when he meets his 12-year term limit in June.

Julia Roberts wearing a Chopard necklace
CollectionsMar 20, 2024
Julia Roberts Co-Designs New Chopard Jewelry Collection

“Chopard x Julia Roberts” showcases the first gems cut from the 6,000-carat-plus “Insofu Emerald."

Tanzanite white gold ring Jared
FinancialsMar 20, 2024
Signet’s Q4 Same-Store Sales Sink 10%

The jewelry giant also posted a double-digit drop in same-store sales for the full year.

Gold and diamond Baume & Mercier watch Elvis gave to Dodie Marshall
AuctionsMar 20, 2024
Vintage Baume & Mercier Gifted by Elvis Going Up for Auction

Elvis gave the watch to actress Dodie Marshall after filming “Easy Come, Easy Go.”

Sketch of Suhan Wang necklace design
Events & AwardsMar 20, 2024
See the Winner of GIA’s Design Competition

The Gianmaria Buccellati Foundation Award for Excellence in Jewelry Design was presented to a graduate of the GIA school in Taipei.

Stock image of a gavel and handcuffs
CrimeMar 19, 2024
Jewelry Factory Supervisor Arrested for Allegedly Stealing Precious Metals

The man was charged with money laundering in connection with the theft of gold, silver, and platinum over the course of three years.

×

This site uses cookies to give you the best online experience. By continuing to use & browse this site, we assume you agree to our Privacy Policy