Perfectus Aluminum to Pay Whopping $549.5M False Claims Act Settlement, Largest Customs Fraud Settlement Ever

Posted May 21, 2026

By the Constantine Cannon Whistleblower Team

On May 12, the Department of Justice (DOJ) announced that California-based Perfectus Aluminum and four affiliated warehousing companies agreed to pay $549.5 million to settle allegations they violated the False Claims Act by evading antidumping and countervailing duties owed on aluminum extrusions imported from China.[1] It is the largest customs fraud False Claims Act settlement ever, and far exceeds the prior record amount of $54.4 million that Ceratizit USA agreed to pay in December to settle similar allegations.

What Was the Customs Fraud Perfectus Allegedly Committed?

An importer of goods into the U.S. must declare to Customs and Border Protection (CBP) the value and country of origin of the imported goods and the amount of any applicable customs duties, including antidumping and countervailing duties. Antidumping duties protect against foreign companies “dumping” products into the U.S. at below-cost prices. Countervailing duties offset subsidies foreign government apply so imports from their countries can be sold more cheaply. Both duties are designed to protect U.S. companies from unfair pricing advantages of foreign companies competing in the U.S.

According to the Government, for the three-year period July 2011 through June 2014, Perfectus and its affiliated warehousing companies avoided paying antidumping and countervailing duties they owed on more than 2.2 million aluminum extrusions they imported from China in the form of pallets. They allegedly did so by mischaracterizing the pallets on their Customs Form 7501 Entry Summaries. Instead of identifying them as aluminum extrusions subject to the duties, they misrepresented them as finished merchandise not subject to the duties.

But the pallets were simply aluminum extrusions spot-welded together to make them look like functional pallets and there were no customers for them. As further detailed in the accompanying Settlement Agreement, the scheme allowed the Perfectus defendants to avoid duties of roughly 375% owed on more than $880 million of extruded aluminum, depriving the Government of more than $3 billion in applicable duties.[2]

In August 2021, a jury in the Central District of California convicted the Perfectus defendants of various criminal violations, including customs fraud, wire fraud, and money laundering. In April 2022, they were ordered to forfeit to the Government roughly 280,000 aluminum structures in the shape of pallets and pay restitution to CBP of roughly $1.8 billion. And in October 2025, they agreed to sell the subject warehouses, applying the net proceeds of those sales to partially pay what they owed in restitution.

What Other False Claims Act Customs Fraud Settlements Has DOJ Recently Secured?

In addition to the Ceratizit settlement DOJ secured just a few months ago, the Perfectus settlement follows a string of several other False Claims Act settlements over the past year in cases alleging customs fraud with Chinese imports. Like with Perfectus, all of them involved the importer allegedly mischaracterizing the products they imported from China or otherwise concealing the customs fraud in which they were engaging:

- In November 2025, Harman International Industries agreed to pay roughly $11.8 million to settle allegations it violated the False Claims Act by evading antidumping and countervailing duties on aluminum extruded heat sinks from China.

- In August 2025, Allied Stone agreed to pay $12.4 million for allegedly mischaracterizing its quartz surface countertop/cabinetry products from China as marble or crystallized glass.

- In July 2025, MGI International subsidiaries Global Plastics and Marco Polo International agreed to pay $6.8 million for allegedly claiming the wrong country of origin and value on plastic resin products they imported from China.

- In July 2025, Grosfillex agreed to pay $4.9 million for concealing that certain furniture parts imported from China were made of extruded aluminum.

- And in March 2025, Evolutions Flooring agreed to pay $8.1 million for allegedly mischaracterizing the country of origin of the wood flooring it imported from China.

Is Customs Fraud A DOJ False Claims Act Enforcement Priority?

This recent series of customs fraud cases — underscored by these back-to-back record settlement amounts, with the latest among the largest False Claims Act settlements of any type — makes clear that the Government’s crusade against customs fraud is only getting stronger.

Acting Attorney General Todd Blanche himself weighed in on this in the press release announcing the Perfectus settlement, stressing the importance enforcing “the payment of tariffs intended to level the playing field for U.S. manufacturers,” and starkly warning that “[t]hose who try to game the system . . . will be brought to justice.” And DOJ Civil Chief echoed this sentiment, highlighting how the settlement “once again demonstrates [DOJ] will zealously pursue those who seek an unfair advantage in U.S. markets by evading customs duties.”

As we have previously posted, the treatment by DOJ and the Trump Administration of customs fraud as a top enforcement priority not only comes from these False Claims Act settlements and how heavily the Government has promoted them. It also comes from the aggressive actions the Government has taken to uncover these customs fraud schemes. Last August, DOJ launched a customs fraud task force, partnering with Homeland Security to “aggressively pursue” customs scofflaws and companies smuggling prohibited goods into the country. And last May, DOJ expanded its Corporate Whistleblower Awards Pilot Program to specifically include customs fraud within its ambit.

As Constantine Cannon whistleblower partner Gordon Schnell commented in our post on the Ceratizit settlement, “With the steady stream of False Claims Act settlements, the recently launched customs fraud task force, and the expanded focus of DOJ’s corporate whistleblower program, DOJ has tripled down on its campaign to stamp out customs fraud.”

Constantine Cannon customs fraud specialist Dan Noel adds, “What is especially notable about this increased enforcement activity is that the settlement numbers are getting larger and larger.” According to Noel, who has several False Claims Act customs cases DOJ is investigating, “I expect the stream of big customs fraud settlements to continue, mostly prompted by whistleblowers with firsthand knowledge of the fraud bringing these cases to the Government.”

What Role Do Whistleblowers Play in Reporting Customs Fraud?

Noel notes the disproportionate involvement of whistleblowers in these False Claims Act cases. Under the qui tam provisions of the statute, whistleblowers can bring lawsuits on behalf of the Government directly against the companies committing the fraud. In return, they can receive up to 30% of the Government’s recovery. That is how the Perfectus case originated, with several whistleblowers bringing actions, which DOJ consolidated and took over. They will receive a whistleblower award of 17.5% of the proceeds from the sale of the warehouses and aluminum pallets Perfectus agreed to forfeit, which could potentially amount to a very sizeable sum.

A whistleblower also originated the Ceratizit matter, receiving a whistleblower award of close to $10 million. The Harman, Allied Stone, Grosfillex, and Evolutions Flooring matters also were all originated by whistleblowers under the qui tam provisions of the False Claims Act. Noel says, “It is difficult to uncover these schemes without someone on the inside with a front row seat; that is why we are seeing whistleblowers bringing so many of these cases.”

That is also why the Government is urging customs fraud whistleblowers to come forward with the promise of significant financial rewards. In fact, in announcing both the Perfectus and Ceratizit settlements, DOJ specifically encouraged whistleblowers to do just that, explicitly stating it “encourages whistleblowers to alert the government to credible allegations of fraud, including utilizing the qui tam provisions of the False Claims Act or through the Department’s Corporate Whistleblower Program.”

Constantine Cannon Has Substantial Experience Representing Customs Fraud Whistleblowers Under the False Claims Act

Constantine Cannon has substantial experience representing customs fraud whistleblowers under the False Claims Act. In one of our more recent cases, the firm represented a whistleblower alleging an auto parts distributor misclassified brake pads imported from Asia to avoid millions of dollars of customs duties. The company settled that matter for $8 million with our client receiving 18.5% of the Government’s recovery.

If you would like to learn more about our other whistleblower successes, customs fraud, the False Claims Act, or what it means to be a whistleblower more broadly, please do not hesitate to contact us. We will connect you with an experienced member of the Constantine Cannon whistleblower team for a free and confidential consultation.