Forty-two days ago, a customs broker knowingly hired a person convicted of a felony. At no point has the customs broker sought approval for this hire from CBP. Additionally, CBP is not aware of this hire. As of today, what is the heaviest single maximum penalty that can be assessed by CBP against this broker for not seeking approval from the appropriate Executive Director, Office of Trade for the felon's continued employment?
How to get there
19 CFR Part 171, Appendix C, § VII: 19 U.S.C. 1641(d)(1)(E)A. A broker has 30 days to seek approval … If he seeks the approval within such time, no penalty will be assessed.
B. A $5,000 penalty for knowingly employing any convicted felon and failing to make application … within 30 days of the date of discovery of the felony conviction.
C. A $25,000 penalty for knowingly employing any convicted felon without seeking approval for employment.
D. A $30,000 penalty for knowingly employing any convicted felon and continuing to employ same after approval has been denied (generally revocation or suspension …).
B. A $5,000 penalty for knowingly employing any convicted felon and failing to make application … within 30 days of the date of discovery of the felony conviction.
C. A $25,000 penalty for knowingly employing any convicted felon without seeking approval for employment.
D. A $30,000 penalty for knowingly employing any convicted felon and continuing to employ same after approval has been denied (generally revocation or suspension …).
The broker hired the felon knowingly 42 days ago, well past the 30-day window, and has never sought approval. That's paragraph C. Approval wasn't denied (it was never requested), so the $30,000 tier doesn't apply. The answer is C.
Why the other choices are wrong
A) $5,000: the tier for a broker who does apply, just late (after 30 days). This broker hasn't applied at all.
B) $10,000 plus suspension: not a tier in § VII.
D) $30,000 plus revocation: reserved for continuing to employ the felon after approval was denied.
Tip
Felon employment ladder: apply within 30 days, no penalty; apply late, $5,000 (mitigable to $2,000 if within 60 days); never apply, $25,000; employ after denial, $30,000 plus likely suspension or revocation.
Source: 19 CFR Part 171, Appendix C, § VII (eCFR).
CBP answer key: Answer C · 19 CFR 171, Appendix C, VII(C)Source: CBP past exams ↗