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Spokane, Washington  Est. May 19, 1883

Packers Sentenced For Scheme

Associated Press

A Kirkland fruit trader, a former Wenatchee fruit-packing official and a Bellevue-based import company were fined and given probation Tuesday for their roles in a scheme to get around Taiwan’s import quotas.

Shou Shia Wang, Ted Zacher and WLH Group Inc. all pleaded guilty in July to federal charges stemming from the scheme to use the Washington State Apple Commission logo to mislabel New Zealand apples bound for Taiwan.

New Zealand apples were purchased from U.S. stores, placed in boxes bearing the commission logo, and shipped to fruit wholesalers in Taiwan between April 1991 and May 1992, prosecutors contend. The apples were marked with New Zealand stickers.

New Zealand’s gala apples are prized in Taiwan as holiday gifts, but quantities are limited by Taiwanese import quotas.

About 32,000 boxes are believed to have been relidded in the scheme, but there was disagreement over how much the defendants profited. Federal prosecutors and defense attorneys said New Zealand apples sold for as much as $110 a box in Taiwan, compared to about $40 a box for Washington state red Delicious apples.

It is believed that WLH made between $148,000 and $206,000, but federal officials were unable to subpoena additional documents from the Taiwanese, said Assistant U.S. Attorney Greg Shogren of Yakima.

U.S. District Judge Justin Quackenbush handed down the sentences Tuesday.

Wang, 45, of Kirkland, was fined $200,000 and placed on 18 months of unsupervised probation. He pleaded guilty in July to one count of making false statements to federal agents.

Wang is a principal in WLH Group, a Taiwanese import firm based in Bellevue, which was fined $1 million and placed on three years probation after attorneys entered guilty pleas to three counts of making false statements.

Zacher, then-president of the Chief Wenatchee packing cooperative, pleaded guilty to one count of trafficking in counterfeit goods and was fined $5,000 and placed on unsupervised probation.

Zacher was accused of placing New Zealand apples purchased from Safeway Stores into boxes with the Washington Apple Commission label.

After an anonymous tip, state fruit inspectors discovered the relidding operation in May 1992.

A federal grand jury subsequently handed up a 50-count indictment charging four individuals and three corporations with conspiracy, trafficking, making false statements and money laundering. Most counts were dismissed as part of the plea agreement.

The Chief Wenatchee cooperative in Wenatchee was not implicated, but Quackenbush said he was skeptical about setting aside money for potential restitution claims from the organization against Wang and Zacher.

“I have some difficulty determining whether Chief Wenatchee suffered a loss and whether they are entitled to restitution because they were a participant,” he said.