We are pleased to announce that our client, Todd Mihajlovic, exposed the concealment of the origin of goods imported into the United States by ECL Solutions Limited, Inc., a British company doing business with the U.S. military as Ban-Air Storage Systems (“ECL”). Yesterday, the U.S. Department of Justice announced that ECL pleaded guilty to conspiring to smuggle goods into the United States and was ordered to pay a forfeiture money judgment of $1,066,132.10 in the criminal prosecution in the U.S. District Court for the Eastern District of Pennsylvania. The Government’s press release announcing the success in the criminal matter can be found on the DOJ’s EDPA website here.
We represented Mr. Mihajlovic, who filed a civil qui tam lawsuit under the False Claims Act in the U.S. District Court for the District of Delaware in 2012. Mr. Mihajlovic’s complaint alleged that ECL violated the False Claims Act because of false representations made by the company that products it sold to the United States complied with the Buy American Act (BAA) and the Trade Agreements Act (TAA). According to the Complaint, ECL obscured the fact that its steel racking systems sold to the U.S. military were actually imported from China.
Mr. Mihajlovic has our profound gratitude for bringing the company’s scheme to the attention of the U.S. Government. Here at McEldrew Young Purtell Merritt, Attorney Brandon Lauria took the lead on the case and spent countless hours on the case to see it to a successful resolution. We were assisted by United Kingdom Solicitor-Advocate Howard S. Brown, who is associated with Shepherd, Finkelman, Miller & Shah, LLP.
This case is an example of the rise of international whistleblowing, as our client is located outside the United States. Fortunately, the whistleblower laws incentivize reporting by individuals regardless of their location and citizenship. The False Claims Act, as well as the SEC, CFTC, and IRS whistleblower programs, do not restrict the U.S. Government from rewarding international whistleblowers. Otherwise, in the era of transnational commerce, fraud might go unchecked simply because the evidence of the corporate wrongdoing is located in a foreign country.
If you are a whistleblower, located here in the United States or abroad, interested in reporting customs fraud in America or the bribery of customs officials abroad, contact our office for a free initial legal consultation concerning your case.