DOJ Settles Case for Over $5.2 million

(This blog was written by whistleblower investigator Lee Walters.)

In an announcement released last week, the United States Department of Justice (DOJ) resolved allegations that Blue Furniture Solutions, LLC, its successor XMillenium, LLC, and two former executives, CEO Yingqing Zeng and CFO Alex Cheng, with the defendants agreeing to pay more than $5.2 million for violations of the False Claims Act.

The defendants were allegedly importing wooden bedroom furniture into the United States without paying the required anti-dumping duties and other customs fees. An anti-dumping duty is a tariff that the U.S. imposes on foreign imports that it believes are priced below fair market value.

In the government’s complaint, it was alleged that the defendants conspired to evade millions of dollars in anti-dumping duties and customs fees by falsely describing wooden bedroom furniture imported from China as “metal” or “non-bedroom” furniture on documentation submitted to U.S. Customs and Border Protection. The defendants manipulated images of their products in packing lists and invoices and conspired with their Chinese manufacturers to ship the furniture in mislabeled boxes and falsify invoices.

As tariffs have increased on products from China during the Trump administration, another scheme our team has seen, that seems to be even more prevalent these days, are importers/exporters trying to disguise the true country of origin of the manufacturer. Known as transshipment, in an attempt to avoid tariffs, Chinese exporters are shipping goods manufactured in China to Vietnam, where they are made to appear as if they’ve been manufactured in Vietnam. The products are then shipped from Vietnam to the U.S. with little, or no, anti-dumping duties, and customs fees are charged, saving importers millions.

Do you work for an importer who is trying to get around paying duties and fees rightfully due to the U.S. and U.S. taxpayers? Under the False Claims Act, you could earn a reward of 15-30% of the amount recovered by the government as a result of an investigation initiated by you. Contact our Whistleblower team to learn more about the False Claims Act and how we can help you navigate a filing and protect your rights as a whistleblower.