Investigations

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Six Plead Guilty in Gray Market Vehicle Conspiracy

Six defendants—Thomas Kahnt, Nicole G. Schmitt, and Containers Services International, Inc., Miami, FL, and Kai Stadler, Alpe Elke, and Individual Automobile Imports, Inc., Ft. Lauderdale, FL—pleaded guilty in U.S. District Court in Miami, to conspiracy for illegally smuggling dozens of luxury cars into the U.S and selling them. The defendants imported the vehicles, valued in excess of $1.5 million, under the “foreign national exception,” which allows short-term visitors to bring their cars into the country without having to pay taxes on them. The defendants then fraudulently titled and sold the vehicles without paying U.S. Customs duties or bringing them into compliance with DOT safety and EPA environmental standards. As part of their pleas, Kahnt and Schmitt agreed to forfeit $551,725 and $54,525, respectively. Sentencing has not been set. OIG investigated this case with EPA, the U.S. Customs Service, and NHTSA.