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Contract Non-Compliance

This archive displays posts tagged as relevant to fraud arising from or resulting in non-compliance with government contracts. You may also be interested in the following pages:

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Catch of the Week – EHR Developer Greenway Health to Pay $57.25 Million to Settle FCA Allegations

Posted  02/8/19
Person in scrubs holding computer tablet projecting medical data
Electronic health records (EHR) software developer Greenway Health LLC agreed to pay $57.25 million to resolve allegations that it committed fraud by misrepresenting to its users the capabilities of its EHR product “Prime Suite” and by providing unlawful remuneration to users to induce them to recommend Prime Suite. Under the American Recovery and Reinvestment Act of 2009, the government made incentive payments...

February 8, 2019

In connection with alleged fraud on a multi-billion dollar Department of Energy contract, the United States has filed a False Claims Act complaint against Mission Support Alliance LLC (MSA), Lockheed Martin Services Inc. (LMSI), Lockheed Martin Corporation (LMC) and Jorge Francisco Armijo, currently VP of LMC but formerly president of MSA. The complaint alleges that defendant LMSI violated the FCA by submitting false statements about its profits to order to inflate its billing rate. The complaint also alleged that, in violation of the Anti-Kickback Act, defendant LMC paid Armijo and other MSA executives more than $1 million in order to win a $232 million subcontract to clean up the Hanford nuclear waste site in Washington State. DOJ; USAO EDWA

February 5, 2019

Eurofins Lancaster Laboratories Environmental LLC has agreed to pay the United States $135,742 after self-disclosing that it had improperly billed the U.S. Army $67,871 for 1,436 test results that it later discovered were improperly altered by an employee. Since coming forward about the misconduct, the Pennsylvania branch of the international laboratory testing provider has fired the employee, retested the samples in question, and worked with the government and other regulators to implement preventative measures on similar misconduct. USAO EDPA

January 28, 2019

Northrop Grumman Systems Corporation (NGSC) will pay $5.2 million to resolve allegations of False Claims Act liability for fraudulently billing labor under a contract with the United States Postal Service. NGSC, a provider of information and technology services, entered into an Enterprise Technology Services Contract with USPS, and allegedly billed work by personnel who lacked the experience and the education required under the contract. DOJ

January 28, 2019

Universal Concrete Products Corporation, which subcontracted to provide precast concrete for the Dulles Metrorail Project, and its principal Donald Faust, Jr., will pay $1 million to resolve allegations under the False Claims Act that the company falsified test records to make it appear that concrete panels met the general contractor’s standards when they did not.  In 2018, a UCP quality control employee pleaded guilty in related charges.  The government’s investigation began with a qui tam case filed by an unidentified whistleblowerUSAO EDVA

November 16, 2018

The owners and CEOs of the largest e-waste recycling company in Washington State have pled guilty and agreed to pay $1.1 million for lying to the public and to public agencies about recycling electronics in an environmentally safe manner. As the largest participant in the state's "E-Cycle Washington" program, Craig Lorch and Jeff Zirkle's company, Total Reclaim, was paid millions of dollars by customers like the City of Seattle to properly handle and dispose of millions of pounds of mercury-containing e-waste. However, through tracking devices hidden in surrendered products, local nonprofit Basel Action Network found that Total Reclaim was in fact secretly shipping their e-waste to Hong Kong, where they were dismantled without any sort of safety precautions. USAO WDWA

November 14, 2018

Former contractors George Patton and Henry Patton have pleaded guilty to defrauding the United States in federal contracts worth over $10 million. According to the DOJ press release, George Patton was barred from conducting business with the federal government but conspired with his brother, Henry, and wife, Lindsey, to obtain additional federal contracts by naming them owners of his new businesses. Separately, George and Lindsey Patton were also accused of evading about $61,000 in taxes, which, after penalties and interest, translated to a loss of $107,000. All three face sentencing early next year. DOJ

November 13, 2018

Two foreign airlines, British Airways and Iberia Airlines, have agreed to pay $5.8 million to resolve allegations brought under the False Claims Act that they falsely reported timestamps for deliveries made abroad. As part of their contracts with the United States Postal Service (USPS) to deliver U.S. mail to recipients at foreign posts, such as military bases, the airlines were required to submit accurate delivery information in order to obtain payment, but were found to have falsified that information instead. DOJ

Catch of the Week — Universal American Mortgage Company

Posted  10/19/18
Universal American Mortgage Company (UAMC), a Miami-based mortgage company, agreed on October 19 to a $13.2 million settlement to resolve allegations that it violated the False Claims Act (FCA) by falsely certifying that it complied with Federal Housing Administration (FHA) mortgage-insurance requirements in connection with certain loans. UAMC is part of Lennar, one of America’s leading homebuilders. The...

October 15, 2018

Indal Technologies Inc. has agreed to pay $3.5 million to settle claims that it violated the False Claims Act by knowingly selling the U.S. Navy helicopter landing systems that used substandard steel. The alleged fraud by Indal Technologies involved the substitution of a stronger steel for a weaker, less inexpensive steel in a component that helps secure a landing helicopter onto certain Navy destroyers. Due to the possibility of rough winds and seas during landing, it is crucial for this component to be made of high strength steel. DOJ; USAO NJ
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