Colo. Company, Owner to Pay $625,000 for Violating FCA, Lying About Chinese Origin of Goods Sold to US

Instec Inc., a scientific instrument technology company based in Colorado, and Dr. Zhong Zou, its owner and president, agreed to pay $625,000 to settle allegations that the company and Zou violated the False Claims Act, DOJ announced. Instec and Zou failed to comply with the requirements of the Buy American Act when selling scientific instruments claimed to have been made in the U.S. to U.S. federal agencies and national laboratories, DOJ said.

The U.S. alleged that Instec and its owner knowingly violated the BAA by "falsely certifying" that goods sold to the federal government under contracts with domestic-preference requirements were made in the U.S., when in fact they were actually made in China. “When companies commit to manufacture their goods in the United States, then shirk that commitment, they violate the law and undermine American manufacturing jobs, too,” U.S. Attorney for the District of Colorado Cole Finegan said, adding that his office “is committed to enforcing the Buy American Act and pursuing companies that violate it.”

The False Claims Act violation allegation was made by a former Instec employee under the qui tam provision of the act, which allows a private party to file an action and get a part of any recovery. In the present action, the relator will receive $124,500 as part of the settlement, DOJ said.