September Government Contracting Fraud Round-Up - TZ Legal - Fraud Fighters
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September Government Contracting Fraud Round-Up

Date Published

Sep 28, 2021

September 28, 2021.  The United States Department of Justice recently settled cases against four southern-states-based government contractors who misrepresented their business practices in order to bid on and fulfill contracts.  Under the terms of the settlements, these contractors collectively paid approximately $2 million to settle allegations.

Earlier in September, two Georgia-based companies settled False Claims Act allegations after being investigated by the U.S. Army Criminal Investigation Command and Defense Criminal Investigation service.  The contractors allegedly provided unapproved substitute parts to military programs (i.e., parts for military equipment which are not made in America, violating the Buy American Act).  A whistleblower brought this case to the government’s attention, and under the False Claims Act, they are entitled to 15-25% of the government’s recovery.

More recently, two Virginia-based government contractors allegedly conspired to use one company’s designation to assist another company in bidding on government contracts.  One contractor was certified as an 8(a) small business by the Small Business Administration, identifying it as being owned or operated by a socially or economically disadvantaged citizen.  This certified 8(a) contractor used its status to bid on contracts for which it was eligible, but then it subcontracted “all the work on that contract” to an ineligible contractor “in exchange for a ‘fee’ calculated by each hour of work” which the subcontractor then paid back to the prime contractor in this kickback scheme.  Unfortunately, this was not the first arrangement this contractor made to “share” their 8(a) status, as they had a similar kickback scheme in 2018-2020.

Government contracting fraud is harmful to government programs designed to give a “leg up” to economically disadvantaged small businesses and to those programs which encourage domestic manufacturing and economic development. Representing to the government that one contractor is going to do a job, and then subcontracting all the work to another company, is fraudulent activity that whistleblowers should be empowered to report. Overcharging the government and using suppliers outside of the Trade Agreements Act are also activities that are violations of the False Claims Act.

Renée Brooker of Tycko & Zavareei LLP will be moderating a panel on government contractor fraud at the annual Taxpayers Against Fraud conference in October. The panel is called, “The False Claims Act as a Weapon Against Cyber Fraud.”

If you would like to report government contracts fraud, you can contact attorneys at Tycko & Zavareei LLP. Eva Gunasekera and Renée Brooker are former officials of the United States Department of Justice and prosecuted whistleblower cases under the False Claims Act. Renée served as Assistant Director at the United States Department of Justice, the office that supervises False Claims Act cases in all 94 United States District Courts. Eva was the Senior Counsel for Health Care Fraud. Eva and Renee now represent whistleblowers.

For a free consultation, you can contact Renée at reneebrooker@tzlegal.com (tel.: 202-417-3664) or contact Eva Gunasekera at eva@tzlegal.com. You can also go to Tycko & Zavareei LLP’s website for whistleblowers to learn more at https://www.fraudfighters.net/.

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