By Jeffrey A. Newman Esq. MBA
On May 12, 2026, the DOJ announced that Perfectus Aluminum Inc. and affiliated companies agreed to pay $549.5 million to resolve False Claims Act (FCA) allegations arising from a scheme to evade customs duties on aluminum imports from China. This settlement (more than ten times larger than the previous customs-related FCA record) signals that DOJ is now deploying the FCA’s treble-damages framework as a primary weapon against tariff evasion. For companies that import goods subject to anti-dumping and countervailing duties (AD/CVD), Section 301 tariffs, or other special tariffs.
The Perfectus case was a scheme to evade antidumping and countervailing duties owed on aluminum extrusions imported from China. From July 2011 through June 2014, the Perfectus imported more than 2.2 million aluminum extrusions disguised as “pallets” by spot-welding them together to appear as finished merchandise not subject to the AD/CVD order. No pallets were ever sold.
That civil settlement, $549.5 million, is all the more striking given the timing of the scheme. The conduct occurred from 2011 to 2014, when importers’ primary recourse for self-reporting was U.S. Customs and Border Protection’s longstanding voluntary prior disclosure program, which can reduce or eliminate civil penalties. But DOJ’s 120-day safe harbor for voluntary reporting matters raised by internal whistleblowers had not yet been established.
The $549.5 million settlement resolves civil allegations that Perfectus knowingly submitted false customs declarations, evading AD/CVD owed on aluminum imports. The case relies on the FCA’s “reverse false claims” provision, 31 U.S.C. § 3729(a)(1)(G), which imposes liability on anyone who “knowingly conceals or decreases an obligation to pay or transmit money or property to the Government.” This means any company that knowingly underreports value, misclassifies goods, or misrepresents country of origin to reduce customs obligations may face FCA liability, including treble damages and civil penalties that can exceed $27,000 per violation.
The $549.5 million figure is substantially higher than 2025 customs-related FCA settlements, which ranged from $4.9 million to $54.4 million. The settlement had the potential to be even higher, considering the $1.8 billion in evaded duties and the FCA’s treble damages multiplier.
Jeffrey Newman, JD, MBA, a former prosecutor, is a whistleblower lawyer whose firm represents physicians and other healthcare providers who become whistleblowers in healthcare fraud cases. The firm also takes cases involving tariff fraud and export control fraud. Whistleblower laws in the U.S. allow individuals with information about export control violations or tariff fraud to report it under the False Claims Act, which, if successful, awards the whistleblower a percentage of the amount collected. The Firm’s website is www.JeffNewmanLaw.com. Attorney Newman can be reached at Jeff@Jeffnewmanlaw.com or at 617-823-3217. For other blogs, see: http://JeffNewmanLaw.com
