Warren, Brown, Whitehouse, Blumenthal Press Treasury, DHS to Eliminate Trade Loophole Enabling Illegal Drug Trade, Protect Americans from Opioid Epidemic
Lawmakers push agencies to use statutory authority to fully eliminate “de minimis exemption” for e-commerce shipments
“We urge you to act quickly and use your authority to protect Americans from drug dealers and predatory online vendors who use this loophole to send dangerous substances over the United States border.”
Washington, D.C. — U.S. Senators Elizabeth Warren (D-Mass.), Richard Blumenthal (D-Conn.), Sherrod Brown (D-Ohio), and Sheldon Whitehouse (D-R.I.) wrote to Department of the Treasury (Treasury) Secretary Janet Yellen and Department of Homeland Security (DHS) Secretary Alejandro Mayorkas, urging the agencies to use their statutory authority to fully eliminate a trade loophole facilitating the illegal drug trade and allowing billions of dollars’ worth of imports to enter the United States with little oversight. Specifically, the lawmakers pressed the officials to abolish the de minimis exemption for e-commerce shipments, a loophole that drug traffickers are abusing to smuggle illicit fentanyl and its precursor chemicals into the United States.
“The opioid epidemic is a serious threat in the United States that has killed hundreds of thousands of Americans. We must use every tool to combat it and protect American families — including the statutory authority Congress provided to the Department of the Treasury and the Department of Homeland Security (DHS) to limit abuse of the de minimis provision,” wrote the lawmakers.
De minimis enables the import of goods worth less than $800 without tariffs or taxes, and bypassing the U.S. Customs and Border Protection’s (CBP) standard information reporting forms. As a result of this lack of oversight, the provision has been abused to facilitate the illegal drug trade — avoiding critical inspections, tariffs, and trade enforcement that protect consumers — and fuel the opioid epidemic.
Last month, the Biden-Harris Administration announced new rulemaking to crack down on abuse of the de minimis exemption. In their letter, the lawmakers welcomed this action as a necessary step toward progress, but pushed Treasury and DHS to use their statutory authority to go further by closing the loophole entirely.
“Further action is needed to fully address the flood of uninspected packages entering into the United States, especially in the e-commerce sector. (Key) schemes to traffic fentanyl components via e-commerce would not be thwarted by the proposed regulation and underscore the need for more scrutiny on e-commerce shipments,” wrote the lawmakers. “DHS should reconsider whether e-commerce shipments should be categorically excluded from de minimis eligibility, and take action immediately.”
A recent Reuters investigation detailed how a single smuggler was able to receive over 15,000 pounds of fentanyl precursors in small packages shipped to his home in Tucson. In July, the Department of Justice uncovered a vast conspiracy to import and distribute over 2,000 kilograms of fentanyl precursors across 100 separate shipments — skirting law enforcement oversight by abusing the de minimis loophole.
“Illicit fentanyl is the leading killer of Americans aged 18 to 49, and the recent DOJ indictment is only the latest evidence of the role de minimis plays in these tragic deaths,” wrote the lawmakers.
The lawmakers detail the specific authority the agencies have to eliminate the de minimis exception for e-commerce — and encourage them to use it immediately to stem the flow of illicit drugs through the exemption. The lawmakers also pose a series of questions to get more information on the impact of potential regulations, as well as additional efforts to reduce abuse of the loophole.
“We urge you to act quickly and use your authority to protect Americans from drug dealers and predatory online vendors who use this loophole to send dangerous substances over the United States border,” the lawmakers concluded.
Senator Warren has also led the charge in calling for the closing of crypto loopholes fueling fentanyl trade. Senator Warren’s bipartisanDigital Asset Anti-Money Laundering Act would close loopholes in anti-money laundering rules, cutting off drug suppliers and cartels from using crypto to facilitate their illegal business. In May, Senator Warren partnered with Senator Bill Cassidy (R-La.) to pen a letter to the White House Office of National Drug Control Policy (ONDCP) and the Drug Enforcement Administration (DEA) seeking an update on the Biden-Harris Administration’s actions to crack down on drug traffickers’ exploitation of crypto to grow their business and launder money.
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