OAKLAND – Chu-Chiang Ho, a/k/a Kevin Ho, pleaded guilty in federal court today to illegally importing automobile headlights that failed to meet U.S. safety standards, announced United States Attorney David L. Anderson and Homeland Security Investigations (HSI) Special Agent in Charge (San Francisco and Northern California) Tatum King. The plea was accepted by the Honorable Jon S. Tigar, U.S. District Judge.
Ho, 44, of Fremont, Calif., admitted that he has known since 2005 that the headlights and other headlight kit parts he had been importing from China were illegal, when he acknowledged in a report to the National Highway Transportation Safety Administration that the High-Intensity Discharge (“HID”) lights he imported from China were too bright and that they did not meet regulatory photometric requirements. Ho claimed at the time that he was discontinuing the sale of all illegal headlights. Nevertheless, for more than 13 years thereafter, he continued to smuggle the illegal parts into the United States and sell them through websites including HIDExtra.com, kalex.us, and opt7.com.
In the plea agreement, Ho admitted that the HID kit components that he imported are prohibited from importation into the United States under 49 U.S.C. §§ 30112 and 30115 because they violate Department of Transportation (DOT) safety laws, including those promulgated at 49 C.F.R. § 571.108, as they emit much brighter light than conventional headlights and can create a public safety hazard.
Ho also admitted that for more than a decade he engaged in various acts designed to conceal his scheme. For example, Ho changed company names numerous times to avoid detection by U.S. Customs and Border Protection (CBP) and he listed a variety of family members as corporate officers of his companies despite maintaining control over the business at all times. Ho also admitted that he misstated to CBP the nature of the merchandise he was importing to deceive the agency into believing the merchandise was legal.
Ho admitted that he profited from his scheme and used the proceeds of the illegal HID Kits to assist in his purchase of various properties in the Bay Area. He admitted that at least $1.7 million in proceeds from sales of his businesses was traceable to products he illegally smuggled into the United States.
A federal grand jury indicted Ho on March 14, 2019, charging him with seven counts of smuggling illegal headlights into United States, in violation of 18 U.S.C. § 545. Under the plea agreement, Ho pleaded guilty to one count. If Ho complies with the plea agreement, the remaining counts will be dismissed. Also as part of the plea agreement, Ho agreed to forfeit at least $1.7 million in criminal proceeds and all of the property he had smuggled into the United States that failed to meet the safety standards of 49 CFR 571.108.
Defendant was released on a bond secured by real property. Bail was set at $750,000.
Judge Tigar scheduled Ho’s sentencing for March 19, 2020. The maximum statutory penalty for a violation of 18 U.S.C. § 545 is twenty years’ imprisonment and a fine of $250,000. However, any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorney Thomas R. Green is prosecuting the case with the assistance of Noble Hughes and Kay Konopaske. The prosecution is the result of an investigation by the Department of Homeland Security, Homeland Security Investigations.