Furniture Importer to Pay Over $217K for Violating False Claims Act

New Hampshire-based furniture seller Yogibo will pay $217,832 to settle charges it violated the False Claims Act by "failing to pay customs duties on imports from China," the U.S. Attorney's Office for the District of Massachusetts announced July 26. The case was brought by David Kohlenberger, a whistleblower and former senior logistics and warehouse manager for Yogibo from 2017 to 2021, who will receive 20% of the settlement.

The importer entered goods into the U.S. from Chinese manufacturer Leadershow Home Textile Co. from 2016 to 2022. For each entry, Leadershow gave Yogibo two invoices -- one that had the price for the imported goods and a second that had a separate and additional charge for inland freight from the Chinese producer to a Chinese port, design services and quality control testing, the U.S. Attorney's Office said.

Yogibo failed to provide the second invoice to its customs broker and only gave the broker the invoice with the lower price. Noting Yogibo's cooperation in the proceeding, acting U.S. Attorney Joshua Levy said DOJ "will deploy the False Claims Act to go after anyone who cheats the system and defrauds the federal government."

The settlement agreement says Yogibo will pay the fine plus a 5.25% interest rate that accrues annually along with $30,410 for Kohlenberger's legal fees.