DOJ Trade-Fraud Unit Raises Payment Compliance Exposure
PYMNTS reported that a new U.S. Justice Department trade-fraud section and more than $1 billion in recent task-force recoveries are pushing banks to compare payment flows with customs and supply-chain records.
The U.S. Justice Department has made trade fraud a standing compliance issue for financial institutions, adding a permanent section on trade-related offenses to a joint government resource guide for banks and other firms that finance global commerce.
The change brings payment records closer to investigations into tariff evasion, false customs declarations, transshipment and forced-labor violations.
PYMNTS reported that the section appears in “A Resource Guide to Trade Fraud Enforcement.” The DOJ Trade Fraud Task Force, which operates with the Department of Homeland Security, has surpassed $1 billion in civil and criminal recoveries, penalties, forfeitures and publicly charged losses in less than a year.
The legal mechanism
Prosecutors can use the False Claims Act, tariff statutes, criminal fraud laws, conspiracy charges, seizures and forfeitures against importers and other parties that misrepresent products or evade trade restrictions.
Customs violations are increasingly being treated as economic crimes rather than administrative mistakes at the border.
That legal shift reaches financial institutions because fraudulent customs declarations often leave financial records behind.
An importer that understates the value of goods still pays its supplier.
A company disguising a product’s country of origin may leave invoices, account records and shipping documents.
A distributor selling illegally imported merchandise eventually receives and moves the proceeds.
Banks already review invoices, purchase orders, bills of lading and inspection records in trade-finance transactions.
Financial-crime teams also monitor trade-based money laundering, in which criminals manipulate the price, quantity or description of goods to move illicit value.
Customs fraud creates a different problem: The money may be legitimate even when the product classification, valuation or country of origin is false.
Payment evidence in trade cases
The compliance question is whether institutions can identify cases where trade documents and payment activity tell different stories.
Payment amounts can show the actual economics of an import.
Account ownership can reveal relationships among suppliers, intermediaries and importers.
Transaction histories may indicate invoice splitting, unusual routing or payments inconsistent with goods declared at the border.
A shipment declared at $500,000 while bank records show a $900,000 supplier payment could reflect freight, insurance, services or multiple combined orders.
It could also indicate undervaluation.
Reconciling that mismatch may help investigators, but banks rarely have complete customs records, while customs agencies do not necessarily see every related payment.
The operational limits
Trade monitoring remains difficult because product descriptions vary, prices fluctuate and transactions often involve several legitimate intermediaries.
Effective detection would require combining payments data with tariff codes, beneficial ownership, origin information, shipping routes and historical pricing.
Much of that information sits outside a standard payment message, and a discrepancy alone cannot establish criminal intent.
PYMNTS Intelligence found that 85% of merchants said their main fraud-related challenge is preventing incidents without damaging the customer experience.
Separately, 51% of global eCommerce merchants expected fraud-management staffing costs to stay flat or decrease, even as 63% planned to spend more on fraud-prevention technology.
Dean M. Leavitt, founder and CEO of Boost Payment Solutions, told PYMNTS in May that many large financial institutions have concluded they cannot build enhancements quickly enough.
“Companies like ours that are very agile, that have our ears constantly to the ground in the marketplace and know what the market needs, and maybe what the market needs next year or the year after.
It’s working quite well,” he said.
The current compliance boundary
Washington has not created a bank-reporting regime specifically for customs fraud, and institutions are not being directed to treat every tariff dispute as evidence of a crime.
The task force’s $1 billion milestone, however, places payment records closer to the government’s trade-fraud cases.
Fraud spending is already rising.
Sixty-eight percent of financial institutions increased fraud-detection budgets year over year, according to the 2025 “State of Fraud and Financial Crime in the United States,” a PYMNTS Intelligence report produced in collaboration with Block.
Forty-six percent reported increasingly sophisticated fraud schemes, up from 35% a year earlier.
Behavioral analytics were used by 70% of surveyed institutions, while 61% used machine learning or artificial intelligence to compare transactions with prior customer behavior and detect unusual activity patterns.
