FEBRUARY 1, 2024. The U.S. Department of Justice on behalf U.S. Customs and Border Protection has announced a settlement with Yakima Products Inc. (Yakima), an Oregon-based automobile accessory company, for failing to pay duties on Chinese extruded aluminum. Yakima will pay $3 million to resolve these claims, which were brought by a whistleblower who will receive 17% of the settlement.
From January 2012 through July 2021, Yakima failed to pay duties on its imports, despite being aware of its requirement to do so. Specifically, Yakima did not pay Anti-Dumping and Countervailing Duties (AC/CVD) on aluminum from the People’s Republic of China (PRC). Avoiding these costs gave the company an unfair advantage by saving money that should have gone into paying duties, like other manufacturers who followed these customs laws. AC/CVD are special taxes placed on imported goods to protect local producers against unfair pricing from foreign competitors. When companies dodge these duties, it can lead to hefty fines, as these payments are crucial for fair competition and trade law compliance. The goal is to ensure a level economic playing field and prevent foreign goods from undermining domestic products unfairly.
A U.S. attorney stated, “Yakima Products Inc. has successfully manufactured and sold automobile accessories for years, but failed to take action when it was informed that it was not paying appropriate duties on material imported from China … Now the company is not only paying those costs, but also penalties as well as the attorney fees of the relator who reported the improper conduct.”
This suit was brought by a former employee, who filed under the qui tam provisions of the False Claims Act. In addition to receiving 17% of the settlement amount, Yakima will also pay $75,000 of the whistleblower’s legal fees.
If you would like to report customs fraud or government contracts fraud, you can contact attorneys at Tycko & Zavareei LLP. For a free consultation, you can contact Jonathan Tycko at [email protected]. You can also go to Tycko & Zavareei LLP’s website for whistleblowers to learn more at www.fraudfighters.net.