The Justice Department’s Trade Fraud Task Force has crossed $1 billion in recoveries, penalties, forfeitures, and charged losses. The announcement came in July 2026, less than a year after its August 2025 inception. For manufacturers and importers, as well as their logistics partners, these cases can provide context around which parts of the supply chain are under the microscope.
A Costly Transshipment Playbook
The largest recovery clocked in at $549.5 million. It came from a False Claims Act settlement with Perfectus Aluminum and four affiliated warehousing companies in California. Between 2011 and 2014, the companies imported more than 2.2 million aluminum extrusions from China and declared them on CBP Form 7501 as finished pallets, a classification not subject to antidumping and countervailing duties. DOJ says the extrusions were spot-welded together to resemble pallets. A jury convicted the companies criminally in 2021, and the civil settlement followed this past May.
Perfectus is the largest case, but it is not the only one built around the same idea. Multiple companies have attempted to relabel origins and reroute paperwork to dodge duties.
Ceratizit USA, a tungsten carbide distributor, paid $54.4 million after DOJ alleged it routed Chinese-made products through Taiwan and re-declared them as Taiwanese to avoid Section 301 tariffs. The company also allegedly misclassified the products under the wrong Harmonized Tariff Schedule code and skipped country-of-origin marking duties.
Boise Cascade paid a $6.4 million fine, twice the profit DOJ says it made on the goods, after its supplier, Horizon Plywood, shipped Chinese birch plywood through Malaysia. While there, it was repacked into new containers and sent on to the U.S. as if it had originated there. DOJ says Boise Cascade kept placing orders for the plywood even after federal agents executed a search warrant at Horizon’s warehouse.
Two Chicago cases folded into the $1 billion total run the same play with gold jewelry. Surya International allegedly mis-declared 563 shipments worth $693 million as Singaporean when the goods actually came from India and the UAE, avoiding roughly $38 million in duties. Importer Barkha Wholesale is accused of running a similar scheme through Oman and Singapore over six years, avoiding about $13.6 million.
Liability Doesn’t Stop at the Port
DOJ has been explicit that its mandate covers “the entire supply chain, including importers, customs brokers, downstream distributors, industrial and commercial end-users, and other supply-chain actors who knowingly profit from merchandise imported contrary to law.”
Under federal law, a case can be prosecuted not just at the port of entry but in any district the goods later move through. This means a distributor or end-user several steps removed from the original customs declaration can still land in hot water if it knew, or should have known, the goods entered illegally. That pushes the compliance burden past the importer of record. Freight forwarders, customs brokers, and buyers relying on a supplier’s country-of-origin paperwork must verify it independently, not just file it.
Whistleblowers Have a Serious Financial Incentive
The Perfectus case started with whistleblowers. Two individuals and the Aluminum Extruders Council, a trade group, sued under the False Claims Act’s qui tam provisions and split 17.5% of the settlement, roughly $96 million. Ceratizit’s whistleblower, a single individual, collected $9.75 million. That’s a direct financial incentive for competitors, trade associations, and former employees to report suspected duty evasion. DOJ actively promotes this type of activity through its Corporate Whistleblower Program.
The MGI International case shows the other side. MGI, a plastic resin distributor, misrepresented Chinese-origin goods to dodge Section 301 duties, but the company caught the scheme itself. It disclosed the evasion to DOJ and overhauled its compliance program. DOJ, in response, credited MGI’s prior $6.8 million FCA payment and declined to prosecute the company at all. Only its former COO, who orchestrated the scheme, was criminally charged.
Non-Duty Risk is in Scope Too
Not every case is about tariffs. Boise Cascade’s exposure ran through the Lacey Act, which criminalizes trafficking in illegally sourced timber, not just customs valuation.
Royal Sovereign paid an $8 million criminal fine and $395,786 in restitution after failing to report to the Consumer Product Safety Commission that its imported air conditioners were linked to more than 40 fires and one death. Sourcing integrity and product-safety reporting sit squarely inside what DOJ calls trade fraud.
What Happens Next?
DOJ and the Department of Homeland Security released a joint Resource Guide to Trade Fraud Enforcement laying out what regulators consider covered conduct and how civil versus criminal resolutions get decided. DOJ backed the effort with a new Global Trade & Commerce Enforcement Section and named the U.S. Attorney’s Office for the Northern District of Illinois as lead prosecutorial partner across 35 participating districts.
U.S. Customs and Border Patrol, working in parallel, says it has assessed more than $2.1 billion in trade-related penalties and barred 35 companies from federal contracts this fiscal year.
Distributors face liability for conduct several steps removed from their own filings, and whistleblowers have a bigger financial reason to come forward. In the current environment, it is important for logistics partners to verify all paperwork, not simply accept it in good faith