26 U.S.C. § 5608 — Penalty and forfeiture for fraudulent

Page 3242 TITLE 26—INTERNAL REVENUE CODE § 5605 as so redesignated, struck out all references to stamps, and struck out former pars. (4) to (11), (13) to (15), and (19), which had consisted of additional provisions con- cerning penalties relating to stamps, marks, brands and containers. Subsec. (b). Pub. L. 98–369, § 454(c)(11)(A), in amending subsec. (b) generally, substituted provisions relating to cross references for provisions relating to officers au- thorized to enforce this section. 1979—Subsec. (a)(1). Pub. L. 96–39, § 807(a)(53)(A), sub- stituted ‘‘section 5205(a)(1)’’ for ‘‘section 5205(a)(2)’’. Subsec. (a)(2). Pub. L. 96–39, § 807(a)(53)(B), substituted ‘‘section 5205(a)(1)’’ for ‘‘section 5205(a)(1) or (2)’’ and ‘‘section 5205(a)(2)’’ for ‘‘section 5205(a)(3)’’. Subsec. (a)(3). Pub. L. 96–39, § 807(a)(53)(C), substituted ‘‘section 5205(f)’’ for ‘‘section 5205(g)’’. Subsec. (a)(6). Pub. L. 96–39, § 807(a)(53)(D), sub- stituted ‘‘section 5205(a)(2)’’ for ‘‘section 5205(a)(3)’’. Subsec. (a)(13). Pub. L. 96–39, § 807(a)(53)(E), sub- stituted ‘‘section 5205(a)’’ for ‘‘section 5205(a)(2) and (3)’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1984 AMENDMENT Amendment by Pub. L. 98–369 effective July 1, 1985, see section 456(b) of Pub. L. 98–369, set out as an Effec- tive Date note under section 5101 of this title. EFFECTIVE DATE OF 1979 AMENDMENT Amendment by Pub. L. 96–39 effective Jan. 1, 1980, see section 810 of Pub. L. 96–39, set out as a note under sec- tion 5001 of this title. § 5605. Penalty relating to return of materials used in the manufacture of distilled spirits, or from which distilled spirits may be recov- ered Any person who willfully violates any provi- sion of section 5291(a), or of any regulation issued pursuant thereto, and any officer, direc- tor, or agent of any such person who knowingly participates in such violation, shall be fined not more than $1,000, or imprisoned not more than 2 years, or both. (Added Pub. L. 85–859, title II, § 201, Sept. 2, 1958, 72 Stat. 1402.) Editorial Notes PRIOR PROVISIONS A prior section 5605, act Aug. 16, 1954, ch. 736, 68A Stat. 684, related to penalty for improper approval of distiller’s bond, prior to the general revision of this chapter by Pub. L. 85–859. See section 7214 of this title. Provisions similar to those comprising this section were contained in prior section 5609, act Aug. 16, 1954, ch. 736, 68A Stat. 685, prior to the general revision of this chapter by Pub. L. 85–859. § 5606. Penalty relating to containers of distilled spirits Whoever violates any provision of section 5301, or of any regulation issued pursuant thereto, or the terms or conditions of any permit issued pursuant to the authorization contained in such section, and any officer, director, or agent of any corporation who knowingly participates in such violation, shall, upon conviction, be fined not more than $1,000, or imprisoned not more than 1 year, or both, for each such offense. (Added Pub. L. 85–859, title II, § 201, Sept. 2, 1958, 72 Stat. 1402.) Editorial Notes PRIOR PROVISIONS A prior section 5606, act Aug. 16, 1954, ch. 736, 68A Stat. 684, related to penalty and forfeiture for distilling without giving bond, prior to the general revision of this chapter by Pub. L. 85–859. See sections 5601(a)(4), 5602, and 5615(3) of this title. Provisions similar to those comprising this section were contained in prior section 5641, act Aug. 16, 1954, ch. 736, 68A Stat. 692, prior to the general revision of this chapter by Pub. L. 85–859. § 5607. Penalty and forfeiture for unlawful use, recovery, or concealment of denatured dis- tilled spirits, or articles Any person who— (1) uses denatured distilled spirits with- drawn free of tax under section 5214(a)(1) in the manufacture of any medicinal preparation or flavoring extract in violation of the provi- sions of section 5273(b)(1) or knowingly sells, or offers for sale, any such medicinal prepara- tion or flavoring extract in violation of sec- tion 5273(b)(2); or (2) knowingly withdraws any denatured dis- tilled spirits free of tax under section 5214(a)(1) for beverage purposes; or (3) knowingly sells any denatured distilled spirits withdrawn free of tax under section 5214(a)(1), or any articles containing such de- natured distilled spirits, for beverage pur- poses; or (4) recovers or attempts to recover by redis- tillation or by any other process or means (ex- cept as authorized in section 5223 or in section 5273(c)) any distilled spirits from any dena- tured distilled spirits withdrawn free of tax under section 5214(a)(1), or from any articles manufactured therefrom, or knowingly uses, sells, conceals, or otherwise disposes of dis- tilled spirits so recovered or redistilled; shall be fined not more than $10,000, or impris- oned not more than 5 years, or both, for each such offense; and all personal property used in connection with his business, together with the buildings and ground constituting the premises on which such unlawful acts are performed or permitted to be performed shall be forfeited to the United States. (Added Pub. L. 85–859, title II, § 201, Sept. 2, 1958, 72 Stat. 1402.) Editorial Notes PRIOR PROVISIONS A prior section 5607, act Aug. 16, 1954, ch. 736, 68A Stat. 684, related to penalty for distilling on prohibited premises, prior to the general revision of this chapter by Pub. L. 85–859. See sections 5505(i) and 5601(a)(6) of this title. Provisions similar to those comprising this section were contained in prior section 5647, act Aug. 16, 1954, ch. 736, 68A Stat. 693, prior to the general revision of this chapter by Pub. L. 85–859. § 5608. Penalty and forfeiture for fraudulent claims for export drawback or unlawful re- landing (a) Fraudulent claim for drawback Every person who fraudulently claims, or seeks, or obtains an allowance of drawback on Page 3243 TITLE 26—INTERNAL REVENUE CODE § 5610 any distilled spirits, or fraudulently claims any greater allowance or drawback than the tax ac- tually paid or determined thereon, shall forfeit and pay to the Government of the United States triple the amount wrongfully and fraudulently sought to be obtained, and shall be imprisoned not more than 5 years; and every owner, agent, or master of any vessel or other person who knowingly aids or abets in the fraudulent collec- tion or fraudulent attempts to collect any draw- back upon, or knowingly aids or permits any fraudulent change in the spirits so shipped, shall be fined not more than $5,000, or imprisoned not more than 3 years, or both, and the ship or ves- sel on board of which such shipment was made or pretended to be made shall be forfeited to the United States, whether a conviction of the mas- ter or owner be had or otherwise, and pro- ceedings may be had in admiralty by libel for such forfeiture. (b) Unlawful relanding Every person who, with intent to defraud the United States, relands within the jurisdiction of the United States any distilled spirits which have been shipped for exportation under the pro- visions of this chapter, or who receives such re- landed distilled spirits, and every person who aids or abets in such relanding or receiving of such spirits, shall be fined not more than $5,000, or imprisoned not more than 3 years, or both; and all distilled spirits so relanded, together with the vessel from which the same were re- landed within the jurisdiction of the United States, and all vessels, vehicles, or aircraft used in relanding and removing such distilled spirits, shall be forfeited to the United States. (Added Pub. L. 85–859, title II, § 201, Sept. 2, 1958, 72 Stat. 1403; amended Pub. L. 89–44, title VIII, § 805(e), June 21, 1965, 79 Stat. 161.) Editorial Notes PRIOR PROVISIONS A prior section 5608, act Aug. 16, 1954, ch. 736, 68A Stat. 685, related to penalty for making or fermenting mash on unauthorized premises, illegal use of spirits, unlawful removal of vinegar, etc., prior to the general revision of this chapter by Pub. L. 85–859. See sections 5505(i), 5601(a)(7), (8), (9)(A), (12), 5615(4), and 5687 of this title. Provisions similar to those comprising this section were contained in prior section 5648, act Aug. 16, 1954, ch. 736, 68A Stat. 694, prior to the general revision of this chapter by Pub. L. 85–859. AMENDMENTS 1965—Subsec. (b). Pub. L. 89–44 substituted ‘‘, with in- tent to defraud the United States,’’ for ‘‘intentionally’’ after ‘‘Every person who’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1965 AMENDMENT Amendment by Pub. L. 89–44 effective July 1, 1965, see section 805(g)(1) of Pub. L. 89–44, set out as a note under section 5008 of this title. § 5609. Destruction of unregistered stills, dis- tilling apparatus, equipment, and materials (a) General In the case of seizure elsewhere than on prem- ises qualified under this chapter of any unregis- tered still, distilling or fermenting equipment or apparatus, or distilling or fermenting material, for any offense involving forfeiture of the same, where it shall be impracticable to remove the same to a place of safe storage from the place where seized, the seizing officer is authorized to destroy the same. In the case of seizure, other than on premises qualified under this chapter or in transit thereto or therefrom, of any distilled spirits on which the tax has not been paid or de- termined, for any offense involving forfeiture of the same, the seizing officer is authorized to de- stroy the distilled spirits forthwith. Any de- struction under this subsection shall be in the presence of at least one credible witness. The seizing officer shall make such report of said sei- zure and destruction and take such samples as the Secretary may require. (b) Claims Within 1 year after destruction made pursuant to subsection (a) the owner of, including any person having an interest in, the property so de- stroyed may make application to the Secretary for reimbursement of the value of such property. If the claimant establishes to the satisfaction of the Secretary that— (1) such property had not been used in viola- tion of law; or (2) any unlawful use of such property had been without his consent or knowledge, the Secretary shall make an allowance to such claimant not exceeding the value of the prop- erty destroyed. (Added Pub. L. 85–859, title II, § 201, Sept. 2, 1958, 72 Stat. 1403; amended Pub. L. 94–455, title XIX, § 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834.) Editorial Notes PRIOR PROVISIONS A prior section 5609, act Aug. 16, 1954, ch. 736, 68A Stat. 685, related to penalty in connection to return of materials used in the manufacture of distilled spirits, prior to the general revision of this chapter by Pub. L. 85–859. See section 5605 of this title. Provisions similar to those comprising this section were contained in prior section 5623, act Aug. 16, 1954, ch. 736, 68A Stat. 687, prior to the general revision of this chapter by Pub. L. 85–859. AMENDMENTS 1976—Subsecs. (a), (b). Pub. L. 94–455 struck out ‘‘or his delegate’’ after ‘‘Secretary’’ wherever appearing. § 5610. Disposal of forfeited equipment and mate- rial for distilling All boilers, stills, or other vessels, tools and implements, used in distilling or processing, and forfeited under any of the provisions of this chapter, and all condemned material, together with any engine or other machinery connected therewith, and all empty barrels, and all grain or other material suitable for fermentation or distillation, shall be sold at public auction or otherwise disposed of as the court in which for- feiture was recovered shall in its discretion di- rect. (Added Pub. L. 85–859, title II, § 201, Sept. 2, 1958, 72 Stat. 1404; amended Pub. L. 96–39, title VIII, § 807(a)(54), July 26, 1979, 93 Stat. 289.)