The United States Department of Justice: Contractors Indicted For Allegedly Evading “Made in America” Laws and Tariffs

In September of 2025, the United States Department of Justice (“DOJ”) announced that a federal grand jury had returned an indictment against two equipment sales companies and their executives for allegedly “defrauding the federal government on sales of forklifts and conspiring to avoid paying proper tariffs on forklifts imported into the United States.” The case involves allegations of conspiracy, false statements, and wire fraud. If convicted, the individuals face up to 20 years of potential prison time, in addition to six-figure fines.

According to the DOJ, the parties conspired to import forklifts into the United States and “disguise the [foreign] origin of the forklifts and then sell the forklifts to federal government agencies by fraudulently representing the forklifts as being manufactured in the United States.” In furtherance of this alleged scheme, the parties allegedly conspired with a foreign national and a foreign manufacturer “to create fake commercial invoices that fraudulently undervalued the cost of forklifts” that they had imported, “thereby defrauding the government of over $1 million in applicable tariffs, duties, and fees.”

The Inspector General stated that the parties charged “allegedly engaged in a brazen scheme to sell rebranded [foreign] made forklifts to FEMA and the Department of Defense, all while falsely certifying their compliance with the Buy America Act.” The DOJ stated that this alleged conspiracy was “especially reprehensible” because it “involved a FEMA contract using disaster funds.” The DOJ noted that the indictments were the result of collaboration with the Defense Criminal Investigative Service and other law enforcement partners.

Public contractors working on projects involving federal funds are familiar with “Made in America” requirements, which can vary depending on the project or contract at issue. In order to obtain payments under public contracts, contractors must generally certify compliance with the requirements of the contract documents, including “Buy America” requirements.  Contractors can face serious consequences – including federal False Claims Act liability – if those certifications are knowingly false. Importantly, knowledge in this context can include instances of willful ignorance (like an ostrich with its head in the sand).

While this particular case represents an extreme example of intentional conduct – including allegedly active efforts to conceal country of origin information for unearned profit – it nevertheless serves as a warning to responsible contractors. Compliance with Made in America laws is critical, as is the need to pay applicable taxes, tariffs, duties, and other fees. Viewing this issue as one of “economic and national security,” the federal government takes an active role to enforce compliance with these requirements. The Deputy Inspector reaffirmed that “[f]ederal contractors are expected to be honest in their dealings with the government” and that the government remains committed “to pursu[ing] allegations of procurement fraud and protec[ing] the government’s supply chain.”

As a result, it remains critical for contractors to pay close attention to applicable Made in America law requirements and take appropriate steps to achieve compliance. Where appropriate or available, contractors should seek out waivers if they anticipate that compliance may not be possible. Failure to take these issues seriously – or follow applicable approval or waiver processes – can result in unwanted risks of potential exposure, particularly since contractors will be expected to know and understand the requirements of their contracts. And certainly, contractors should not take active steps to skirt the law or evade contractual requirements.

UCANE Construction Outlook, November 2025  |  Legal Corner