Whistleblowers: Do You Have Information About Tariff Evasion or Transshipping Schemes?

The federal False Claims Act (“FCA”) allows private individuals with knowledge of fraud against the United States to file whistleblower lawsuits on the government’s behalf and potentially receive a significant share of any recovery.

In recent years, the U.S. Department of Justice has increasingly used the False Claims Act to pursue companies that allegedly evade customs duties, tariffs, antidumping duties, and other import-related obligations. DOJ enforcement efforts have specifically targeted schemes involving false country-of-origin declarations, undervalued imports, and transshipping through third countries to avoid tariffs.

If you have inside information about a company using these practices, you may have grounds to bring a confidential whistleblower claim.

What Is Transshipping?

Transshipping generally refers to routing goods through another country in an effort to conceal their true origin.

For example, a product manufactured in China may be shipped through another country and falsely declared as originating there in order to avoid:

• Section 301 tariffs
• Antidumping duties
• Countervailing duties
• Other customs duties and import restrictions

DOJ and whistleblowers have pursued FCA cases alleging that companies misrepresented the country of origin of imported goods or used intermediary countries to avoid duties owed to the United States.

Who May Qualify as a Whistleblower?

Potential whistleblowers include:

• Current or former employees
• Customs and compliance personnel
• Logistics professionals
• Freight forwarders
• Customs brokers
• Suppliers and vendors
• Competitors with non-public information
• Internal auditors and consultants

You do not need to be an executive or decision maker. Often, individuals responsible for shipping, sourcing, customs compliance, accounting, or import documentation are in the best position to identify misconduct.

Common Warning Signs

Potential evidence of tariff-evasion schemes may include:

• False country-of-origin certificates
• Relabeling or repackaging goods before importation
• Instructions to route products through third countries
• Multiple or inconsistent invoices
• Manipulated customs declarations
• Misclassification of imported products
• Internal discussions about avoiding tariffs or duties
• Efforts to conceal the actual manufacturer or source of products

Significant Financial Incentives Are Available

Under the False Claims Act, successful whistleblowers may be entitled to receive a percentage of the government’s recovery.

Whistleblower awards can range from 15% to 30% of amounts recovered, depending on the circumstances and the government’s involvement in the case. DOJ and courts have increasingly recognized FCA claims involving customs fraud and duty evasion.

Confidential Case Evaluations

Our attorneys are investigating potential False Claims Act cases involving:

• Tariff evasion
• Customs fraud
• Transshipping schemes
• False country-of-origin declarations
• Undervaluation of imports
• Misclassification of imported goods
• Antidumping and countervailing duty evasion

If you have information suggesting that a company is avoiding U.S. tariffs or customs duties through deceptive practices, we invite you to contact us for a confidential evaluation. Our attorneys can assess whether the facts may support a whistleblower claim and explain the protections and procedures available under federal law.

Contact us today for a confidential, no-obligation review of your potential whistleblower claim