Two Brampton-based steel companies have agreed to pay $19 million to settle U.S. Justice Department allegations that they knowingly avoided proper import duties on flat-rolled steel made in Europe and Asia.
The U.S. Department of Justice said Wednesday that Farjess Inc. and Royal Canadian Steel Inc., along with part-owner and president Feroz Jessani, misrepresented the origin of imported steel between May 2019 and January 2025. Federal officials alleged the companies identified the steel as Canadian and American, despite knowing it came from China, Indonesia, Italy, Turkey or Vietnam.
U.S. Justice Department alleges steel origin was misrepresented
According to the Justice Department, the alleged misrepresentation affected duties owed to U.S. Customs and Border Protection. During the period cited by U.S. officials, steel imports that complied with the Canada-U.S.-Mexico Agreement were not subject to tariffs.
The case was brought forward by a whistleblower broker under a False Claims Act provision that allows private parties to file lawsuits on behalf of the United States over alleged false claims. The broker will receive about $3.61 million from the settlement.
“Import duties serve an important role in protecting our national interests generally and the American steel industry in particular,” U.S. Assistant Attorney General Brett A. Shumate said in the news release.
“The Department of Justice will zealously pursue anyone who fraudulently evades the duties owed on steel products imported into this country.”
Record-setting settlement tied to U.S.-Canada steel trade
The Justice Department described the settlement as record-setting. The case comes as steel tariffs remain a sensitive issue in Canada-U.S. trade.
U.S. President Donald Trump imposed 25 per cent tariffs on steel in February 2025 and later raised the duty to 50 per cent, including for imports compliant with the trilateral trade pact.
“Our border is the front line of American industry. Approximately half of all U.S.-Canada land trade flows through our district,” said Jerome F. Gorgon Jr., U.S. attorney for the Eastern District of Michigan.
“And we will continue to protect our businesses from foreign fraudsters.”
The settlement resolves the allegations, while U.S. officials said enforcement around steel imports and customs compliance will continue.
