The United States government has taken legal action against a well-known uniform supplier, Barco Uniforms Inc., along with associated individuals and entities, for purportedly dodging the customs duties on imported apparel. This lawsuit, recently filed, accuses the company and several suppliers of falsifying documentation to underpay duties, a violation of the False Claims Act, as per an announcement by the U.S. Attorney's Office.
Barco Uniforms, a mainstay in providing garments to various industries such as healthcare and hospitality, allegedly engaged in a scheme orchestrated by Kenny and David Chan, operators of companies supplying Barco's overseas-manufactured apparel. Caught in the scandal are multiple businesses operated and controlled by the Chans, including individuals like Able Allied Limited and Nathan Global Direct Inc. Engaged in a double-invoicing setup, incorrect entry summaries were allegedly presented to Customs and Border Protection (CBP), leading to reduced duties by understating the value of the imported goods, the complaint details.
The complaint sprung from the whistleblower actions of Toni Lee, Barco Uniform’s ex-Director of Product Commercialization, under the qui tam provisions of the False Claims Act permitting private individuals to sue on behalf of the U.S. and possibly share in the recovery. The government has taken the lead in this case, aiming to address customs evasion. "Those who import and sell foreign-made goods in the United States must comply with all trade laws," acting Assistant Attorney General Yaakov M. Roth reminded, emphasizing the Justice Department's resolve in holding duty-evaders accountable, as reported by the U.S. Attorney's Office.
The case involves allegations of financial misconduct related to customs duty underpayments and reflects ongoing federal efforts to enforce trade compliance. Acting U.S. Attorney Michele Beckwith stated that fraudulent schemes intended to avoid full payment of customs duties are subject to enforcement. David Salazar, Director of Field Operations for the CBP San Francisco Field Office, noted that the investigation—led by U.S. Customs and Border Protection and Homeland Security Investigations—demonstrates a coordinated approach to enforcement.
Senior Trial Counsel Elspeth A. England and Assistant United States Attorney David E. Thiess are representing the government in the case. At this stage, the allegations have not been proven, and the defendants are presumed innocent until proven guilty. The litigation process may provide additional information regarding the claims. The case, United States ex rel. Lee v. Barco Uniforms Inc., et al., is being heard in the Eastern District of California under case number 2:16-CV-1805.
