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  USA v. Precision Cable Assemblies
  

  The following describes a government action that has been resolved by either a settlement or a decision by a court or administrative agency. If the matter is being appealed, it will be noted below.

  Gregory J. Haanstad, United States Attorney for the Eastern District of Wisconsin, announced that Precision Cable Assemblies, Inc. (PCA), Global Engineered Products, Inc. (GEP), and their principals, Ryan Schmus and Richard Horky, paid over $10 million to resolve allegations that the companies failed to pay millions of dollars in customs duties on goods imported from the People’s Republic of China.

  The United States alleged that PCA and GEP submitted and caused the submission of false commercial invoices to CBP that significantly undervalued the goods imported from China from 2016 through November 2021.  More specifically, two Chinese suppliers sent PCA and GEP invoices in electronic spreadsheet format with the full, actual price of the goods imported.  PCA and GEP, however, falsified the invoices by altering the spreadsheets to reduce the prices, generally by 70%, and then provided those altered invoices to its customs broker, which, in turn, unknowingly submitted the false invoices to CBP.  The United States thus alleged that Defendants avoided payment of millions of dollars of duties on the imported goods, especially after additional duties were imposed on certain goods imported from China in 2018. 
  
  GEP initially paid CBP approximately $4.2 million in duties lost from this undervaluation scheme.  Pursuant to a settlement agreement with the United States Attorney’s Office, Defendants paid another $6 million to the United States to fully resolve its liability for the alleged evasion of duties, including its potential liability under the False Claims Act.
  The settlement resolves a lawsuit filed under the qui tam or whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims submitted to the government and share in a portion of the government’s recovery. The Act permits the United States to intervene and take over responsibility for litigating these cases, as the United States did here.  The qui tam case is captioned United States ex rel. Grob v. Precision Cables Assemblies, Inc., et al., Case No. 22-C-570 (E.D. Wis.).

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