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Senators create new tools to combat textile trade fraud
Oct '11
U.S. Senators Kay R. Hagan (D-NC) and Lindsey Graham (R-SC) reintroduced their bipartisan bill to crack down on fraud and illegal trade practices that damage the American textiles industry. The Textile Enforcement and Security Act (TESA) will beef up enforcement and oversight on the trade of textiles and apparels. Textiles and apparels, which have both suffered from increases in illegal trafficking and duty evasion, have the highest fraud ranking of any industrial products in the United States.

"With North Carolina's unemployment rate at an unacceptably high 10.4 percent, I refuse to allow one of my state's biggest industries to be handicapped by an inability to enforce proper trade rules," said Hagan, co-chair of the Senate Textile Caucus. "Thousands of North Carolinians are employed by the textiles sector, and they produce some of the best products in the world. This bipartisan bill ensures our country has the resources needed to fight the fraud that undermines North Carolina textile mills. I look forward to working with Senator Graham and all of my colleagues to pass this pro-jobs bill as soon as possible."

"I'm proud to join Senator Hagan on a new and improved Textile Enforcement and Security Act," said Graham. "This common sense bill will add significant protection for textile workers by strengthening existing customs enforcement mechanisms and creating new tools to combat fraud. We owe it to the hard working men and women of the textile industry to protect their product against those who seek to take advantage of lax enforcement. This bill does exactly that, and I look forward to seeing its provisions become law."

The U.S. textile industry is the world's third largest textile exporter, and it relies on proper customs enforcement to protect American businesses and jobs. Close to three quarters of the industry's $19 billion in exports last year went to countries where the U.S. has a trade agreement in place. But the industry has seen a sharp increase in illegal trafficking as well as duty evasion in many of these countries through undervaluation, mislabeling and the use of phony companies posing as U.S. companies. It is estimated that up to $1 billion in revenue is lost each year due to this type of customs fraud.

Specifically, the Textile Enforcement and Security Act will:
• Establish an electronic verification program that tracks yarn and fabric imports in countries operating under free trade agreements;
• Increase the number of textile and apparel verification specialists at the 15 largest U.S. ports that process textile and apparel imports;
• Increase textile staff at the Customs and Border Protection Agency headquarters and retarget them toward trade preference verifications. Headquarters staff has been significantly reduced over the last five years.
• Require the publication of a list of fraudulent actors in this field.
• Creates a centralized database for new importers and allows the Customs and Border Protection Agency to adjust bond requirements for high risk importers of textile and apparel goods.


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