Conservation news

Lumber Liquidators pays $13.2M to end illegal logging probe

  • U.S. flooring company Lumber Liquidators Inc. will pay $13.2 million to resolve a federal investigation into its timber sourcing practices.
  • Under the settlement, announced Wednesday, Lumber Liquidators will plead guilty to violating the Lacey Act, a law that regulates imports of timber and wildlife products.
  • Prosecutors say the company’s suppliers in China were using suspect wood from Myanmar and Russia.

U.S. flooring company Lumber Liquidators Inc. (NYSE:LL) will pay $13.2 million to resolve a federal investigation into its timber sourcing practices.

Under the settlement, announced Wednesday, Lumber Liquidators will plead guilty to violating the Lacey Act, a law that regulates imports of timber and wildlife products. Prosecutors say the company’s suppliers in China were using suspect wood from Myanmar and Russia.

The settlement in the criminal case includes a $7.8 million fine, forfeiture of $969,175, and more than $1.2 million in payments and donations, according to a statement from the company. Another $3.2 million would go to the Department of Justice.

The agreement includes four misdemeanors and a felony charge for the company, which also committed to implement an “Environmental Compliance Plan” to ensure compliance with the Lacey Act going forward.

Lumber Liquidators’ transgressions were brought to the public’s attention by a 2013 report issued by the Environmental Investigation Agency (EIA), after a multi-year undercover investigation by the green group found the company had been buying illegally logged timber smuggled from Russia into China. EIA said the practice violated the Lacey Act, which holds U.S. buyers criminally responsible for buying illegal wildlife forest products. At the time, Lumber Liquidators dismissed the allegations.

The company’s stock rose sharply in trading Thursday.