Three Defendants Charged In Alleged Nationwide Multi Million Dollar Illegal Import And Fraudulent Distribution Conspiracies

Press Release

Defendants Allegedly Illegally Imported Pool "Chlorine" from China and Fraudulently Sold and Distributed the Product

SAN FRANCISCO - A federal grand jury indicted three defendants in connection with alleged schemes to import from China, fraudulently market, and illegally transport the hazardous chemical trichloroisocyanuric acid (TCCA), in violation of various U.S. laws and regulations.

One of the defendants, Jermoine "Jay" C. Brantley (aka Jay E. Johnson), 52, of Murrieta, Calif., was arrested Sept. 5 at his home and made an initial appearance in Los Angeles the next day. The other two defendants- Haneef Z. Saleem, 44, of New York, New York; and Brian Morris, 49, of Peoria, Ariz.-are scheduled to appear with Brantley in San Francisco before U.S. Magistrate Judge Alex G. Tse, on Sept. 12 to face the charges.

According to the 26-count indictment, filed Aug. 27 and unsealed Sept. 9, all three defendants conspired to commit wire fraud to convince customers and potential customers to buy the TCCA. In addition, all three defendants are charged with crimes related to the alleged transportation of the chemical from various U.S. ports to other destinations throughout the United States. Brantley and Saleem also are charged with conspiring to smuggle the TCCA into the United States, in violation of various laws and regulations.

The chemical at issue, TCCA, is a product commonly referred to in the swimming pool industry as chlorine. The indictment describes how, during the early 2020s, a domestic shortage of TCCA as well as an increase in the tariffs and duties applying to the importation of the chemical from China resulted in a dramatic increase in the price of TCCA in the United States. Brantley and Saleem allegedly took steps to smuggle the product into the country without paying applicable tariffs and duties that would have made the price of the product less competitive. In addition to the smuggling scheme, the indictment describes how all three defendants allegedly participated in a scheme to fraudulently market and sell the product and arranged to have the hazardous materials transported without the proper paperwork and precautions from U.S. ports to customers throughout the United States.

The Smuggling Conspiracy

The indictment alleges Brantley and Saleem avoided tariffs and duties when importing TCCA from China by supplying the wrong import codes to their brokers so that certain duties would not be assessed. At the time, under the applicable tariff schedule for goods imported into the United States, TCCA was subject to significant "anti-dumping" and "countervailing" duties. Brantley and Saleem allegedly avoided paying these anti-dumping and countervailing duties by supplying their brokers with code numbers that mis-identified the product, identifying it as "disinfectant" and "swimming pool disinfectant," rather than as TCCA. According to the indictment, Brantley and Saleem caused 66 shipments of TCCA to be imported with codes that did not trigger the applicable tariffs and duties.

The Fraud Conspiracy

In addition to the smuggling conspiracy, the indictment describes several ways in which all three defendants allegedly lured customers into purchasing the imported TCCA by making false representations about the product, including false descriptions of the strength and efficacy of the product and its registration status with the Environmental Protection Agency (EPA). According to the indictment, defendants represented to customers and potential customers that their product contained 99 percent TCCA, when, in fact, it had been diluted with boric acid. The indictment also alleges the defendants falsely represented that they, or their products, were "registered with the EPA." But the defendants never properly registered with the EPA to import the chemical and attempted to avoid inspections by mislabeling their product with EPA registration numbers for a different manufacturer. The indictment alleges that customers purchased more than $3.2 million in response to the defendants' fraudulent representations.

Improper Transportation of Product

The indictment also describes how defendants allegedly violated rules pertaining to the transportation of oxidizers and hazardous materials. Defendants' shipments failed to contain labels identifying the TCCA as a "5.1 oxidizer" and as "hazardous material."

In sum, the defendants are charged with the following crimes and, if convicted, face the following maximum statutory penalties:

Defendant	Charge	Maximum Statutory Penalties (per count)
All three defendants	Conspiracy to Commit Wire Fraud 18 U.S.C. § 1349 (one count)	20 years' imprisonment; $1,000,000 fine; maximum 3 years' supervised release
All three defendants	Wire Fraud 18 U.S.C. § 1343 (four counts)	20 years' imprisonment; $1,000,000 fine; 3 years' supervised release
Brantley and Saleem only	Conspiracy to Smuggle Goods Into the United States 18 U.S.C. § 371 (one count)	5 years' imprisonment; $250,000 fine; 3 years' supervised release
Brantley and Saleem only	Smuggling Goods into the United States 18 U.S.C. § 545 (four counts)	20 years' imprisonment; 3 years' supervised release; $250,000 fine
Brantley and Saleem only	Entry of Goods Falsely Classified 18 U.S.C. § 541 (four counts)	2 years' imprisonment; $250,000 fine; 1 year of supervised release
Brantley and Saleem only	Entry of Goods by Means of False Statements 18 U.S.C. § 542 (four counts)	2 years' imprisonment; 1 year of supervised release; $250,000 fine
All three defendants	Distribution or Sale of Unregistered Pesticide 7 U.S.C. § 136j(a)(1)(A), (E) & 136l(b)(1)(B) (two counts)	1 year of imprisonment; 1 year of supervised release; $50,000 fine
All three defendants	Distribution or Sale of Misbranded Pesticide 7 U.S.C. § 136j(a)(1)(A), (E) & 136l(b)(1)(B) (two counts)	1 years of imprisonment; 1 years of supervised release; $250,000 fine
All three defendants	Violation of the Hazardous Substances Act 49 U.S.C. § 5124(c) & (d) (four counts)	5 years' imprisonment; 3 years' supervised release; $250,000 fine

An indictment merely alleges that crimes have been committed and all defendants are presumed innocent until proven guilty beyond a reasonable doubt.

In addition to the penalties listed above, the defendants also may be ordered to pay restitution, if appropriate. However, any sentence following conviction would 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.

The announcement was made by U.S. Attorney Ismail J. Ramsey, U.S. Environmental Protection Agency Criminal Investigation Division (EPA-CID) Special Agent-in-Charge Kim Bahney, U.S. Department of Homeland Security Investigations (HSI) San Francisco Special Agent in Charge Tatum King, and U.S. Department of Transportation Office of the Inspector General (DOT-OIG) Western Region Special Agent in Charge Cory LeGars.

This case is being prosecuted by Assistant U.S. Attorney Barbara Valliere with assistance from Sara Slattery and Kathy Tat. This prosecution is the result of an investigation by EPA-CID, HSI, and DOT-OIG.

Updated September 12, 2024

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