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Redi-Bag USA Settles U.S. Customs Case for $7.3 Million One Day After Asset Sale
Redi-Bag USA and CEO Jeffrey Rabiea agreed to pay $7.3 million to resolve claims they mislabeled Chinese-made plastic bags as Hong Kong products to avoid tariffs. The Justice Department announced the deal on July 15, 2026. A whistleblower will receive $1.3 million.
Jul 15, 7:45 PM·1m read1 source
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Redi-Bag USA and its chief executive Jeffrey Rabiea agreed to a $7.3 million settlement with the Justice Department to resolve allegations they disguised the Chinese origin of polyethylene retail carrier bags on customs forms. @Forbes reported the department announced the agreement on July 15, 2026.
The company allegedly listed the bags as originating from Hong Kong to evade antidumping duties that reach 77.5 percent on Chinese-made bags.
Prosecutors said Redi-Bag ordered employees to cover "Made in China" markings, directed its overseas manufacturer to remove the labels, and canceled shipments scheduled for inspection. John Maierhoffer, a former contracted sales representative, filed a whistleblower lawsuit against the company in 2021 and will receive about $1.3 million from the settlement, according to the Justice Department.
Redi-Bag's assets were acquired by AmerCareRoyal on July 14, 2026, one day before the settlement announcement.
The Justice Department's Trade Fraud Task Force has recovered more than $1 billion in civil and criminal recoveries, penalties and forfeitures since its launch.
