Courts

(Not) Made in the USA: Grand Prairie Man Defrauds the U.S. with Chinese Electronics

A Grand Prairie man faces up to five years in prison for defrauding the U.S. government by selling Chinese electronics he and his company said were made in America.
A Grand Prairie man faces up to five years in prison for defrauding the U.S. government by selling Chinese electronics he and his company said were made in America. Getty Images
Suhaib Allababidi, 45, of Grand Prairie lied to the federal government about where the products his company sold to government entities were manufactured, says U.S. Attorney for the Northern District of Texas, Chad E. Meacham.

According to a statement released by Meacham’s office, Allababidi ’s company, 2M Solutions in Grand Prairie, supplied government agencies with electronic equipment, claiming all the products were American-made instead of disclosing that they were made in China.

The charging document, filed on Nov. 15, states that Allababidi ensured all labels and documentation noting Chinese origins were removed from products before they were delivered to the government. By maintaining their products were American-made, the document reads, “the defendants were also able to secure contracts with the United States and its agencies that had preferences for products made in the United States.”

On Wednesday, Allababidi pleaded guilty to one count of conspiracy to defraud the United States, and 2M Solutions pleaded guilty to one count of conspiracy to defraud the United States and one count of filing false or misleading export information.

According to the company website, 2M Solutions “provides the unique expertise necessary to build the perfect solution for all of your commercial, educational, industrial, and governmental security needs.” The website also claims that 2M has serviced more than 90,000 clients in more than 20 countries.

It’s alleged that Allababidi and 2M Solutions lied about its products being manufactured in China to subvert the Buy America Act (BAA), a law that prohibits government agencies from purchasing goods for use that are made outside of the U.S.

In 2014 2M Solutions was awarded a five-year contract to provide American-made electronic products to the U.S. Government Services Administration, and in 2018 the Department of Defense awarded 2M Solutions a $49,500 contract for three solar security camera trailers. The trailers were shipped directly from China to a U.S. military base for more than $11,000.

In 2019, 2M sold the Defense Department a pair of solar-powered camera towers for $33,877. None of the items sold by 2M under these agreements were manufactured in the U.S.

According to the charging document, Allababidi and 2M Solutions purchased “large quantities of security cameras, NVRs [network video recorders] and DVRs [digital video recorders] from the People’s Republic of China.” These items were then made to look as though they were American by removing any Chinese labels or markings and replacing them with American map-shaped flag decals or labels reading “Made in the U.S.A.”

The government claims Allababidi and 2M Solutions went to great lengths to keep up appearances by bringing their Chinese suppliers into the mix. “On one occasion, when products were to be shipped directly from a Chinese company to the government agency,” Meacham’s statement reads, “a 2M employee sent the Chinese company an email reminding them, ‘We do not want any Chinese characters or stickers on the shipment’ and adding that such stickers ‘will cause many problems for us.’”

In an unrelated case, according to the ACLU’s website, Allababidi was a plaintiff in a lawsuit against the Department of Homeland Security in 2019 following a 2017 incident at Dallas Fort Worth International Airport when his two phones were confiscated by customs and border protection agents as he returned from an overseas trip. Although the initial ruling favored the plaintiffs, that decision was overturned on appeal in 2021.

Allababidi faces up to five years in federal prison, and his company faces up to $1 million in fines, or twice the amount of criminally derived property, whichever is greater.
KEEP THE DALLAS OBSERVER FREE... Since we started the Dallas Observer, it has been defined as the free, independent voice of Dallas, and we'd like to keep it that way. With local media under siege, it's more important than ever for us to rally support behind funding our local journalism. You can help by participating in our "I Support" program, allowing us to keep offering readers access to our incisive coverage of local news, food and culture with no paywalls.
Kelly Dearmore

Latest Stories