January 15, 2014
The Department of Justice has announced that Ohio-based Basco Mfg. Co. has agreed to pay $1.1 million to resolve allegations that it violated the False Claims Act by submitting false customs declarations to avoid paying duties on aluminum extrusion from China that at the time were subject to combined antidumping and countervailing duties of more than 400 percent.
As part of the case, the Department of Justice also has taken over the pending false claims allegations against four other companies and two individuals. The defendants named in the lawsuit are California-based C.R. Laurence Co.; Florida-based Southeastern Aluminum Products Inc.; Texas-based Waterfall Group LLC; New York-based Northeastern Aluminum Corp.; Northeastern’s owner William Ma; and Robert Wingfield, the U.S. representative of Chinese exporter Tai Shan Golden Gain Aluminum Products Ltd.
According to the DOJ, Basco and the defendants named in the government’s lawsuit allegedly engaged in a scheme to avoid duties by shipping the aluminum extrusions manufactured by Tai Shan in the People's Republic of China through Malaysia—a practice called transshipping. The U.S. government alleges that Basco and the defendants knew that the aluminum extrusions were merely repackaged in Malaysia and did not undergo a substantial transformation that may have justified changing the product’s country of origin from the PRC to Malaysia.