The U.S. Customs and Border Protection (CBP) agency will use artificial intelligence (AI) to help it detect illicit transshipment, which is the practice of manipulating supply chains to disguise a product’s true country of origin.
CBP says that some organizations use transshipment to evade tariffs, trade restrictions, and sanctions. To block the practice, the agency has now awarded a “multi-million dollar contract” to Exiger, a McLean, Virginia-based provider of supply chain AI technology. Specifically, Convergent Solutions Inc., doing business as Exiger Government Solutions, will equip CBP enforcement offices and personnel across the U.S. with access to Exiger’s AI platform and data to identify illicit transshipment at-scale and in real-time.
“Billions of dollars worth of global trade move through illegal transshipment channels that seek to bypass U.S. restrictions,” Exiger CEO Brandon Daniels said in a release. “A core CBP mission is to enforce U.S. trade and forced labor laws, thereby helping ensure that American manufacturers and workers are competing on a level playing field.”
According to Exiger, some transshipment is routine and legitimate, occurring as goods are transferred between ships or routed through third countries as part of normal logistics operations. But illicit transshipment occurs when goods are deliberately rerouted through intermediary countries or facilities to conceal their true origin. This practice, sometimes referred to as “Rule of Origin washing,” is commonly used to evade tariffs, Antidumping and Countervailing Duty (AD/CVD) restrictions, sanctions, and other trade restrictions like forced labor import bans. Transhippers exploit opaque supply chains and foreign investment structures to conceal this activity, resulting in lost tariff revenue for governments and hidden compliance, reputational, and security risks for the industry.
The company says its platform can detect illegal transshipment by examining billions of shipment records, entity resolution across hundreds of millions of organizations, and AI-powered anomaly detection to reconstruct trade routes at a granular, transaction-by-transaction level. That approach allows it to link shipments to ultimate beneficial owners and to detect ties to state-owned enterprises, sanctioned parties, or forced labor risks.
