Even though Congress passed a law called the Trade Agreement Act (TAA) that goods purchased by the federal government cannot be made in China, Taiwan, Malaysia and South Africa, this is regularly ignored by manufacturers and re-sellers. The purpose of the law is to prevent unfair competition and to allow nations agreeing with the law to get pricing benefits. Eligible countries include Canada, Mexico, England, France and Japan. Here are just a few examples of companies that paid to settle False Claims Act cases alleging they sold products to the United State even when they were made in the restricted nations:
Samsung Electronics paid $2.3 million to settle allegations it sold products to the US on GSA contracts in violation of the TAA;
OfficeMax Inc. paid $9.8 million to settle allegations it sold office supply products manufactured in China in violation of the TAA;
Staples paid $7.4 million to settle allegations it sold office supply products to the U.S. government made in countries not permitted by the TAA.
It is a violation of the False Claims Act to violate the TAA by selling products to the U.S. government that are made in countries not part of the Trade Agreement Act. A whistleblower may bring an action on behalf of the government and receive rewards between 15-30% of the amount the government collects back from a government contract that sells goods, supplies or services made in China, Taiwan, India or Malaysia.
Jeffrey Newman represents whistleblowers.