Financial Fraud

A settlement has been reached to resolve False Claims Act allegations against Centerra Services International Inc. 

The allegations arose from a lawsuit, claiming Wackenhut Services LLC, currently known as Centerra Services International Inc, violated the False Claims Act by double billing and inflating labor costs in connection with a contract for firefighting and fire protection services in Iraq.

On Monday, the Department of Justice announced that Wackenhut provided U.S. military bases with firefighting and fire protection services under a subcontract with Kellogg Brown & Root Inc. (KBR), the prime contractor for the Army’s contract for logistical support in the military theater, known as LOGCAP III.  LOGCAP III is the third generation of contracts under the Army’s Logistical Civil Augmentation Program.  The government alleged that from 2008 to 2010, Wackenhut inflated its labor costs by billing the salaries of certain managers as direct costs under the subcontract, when those salaries had already been charged as indirect costs.  The government further alleged that Wackenhut artificially inflated its labor rate by counting its costs for holidays, vacation, sick leave, rest and recuperation and other variable labor costs twice in calculating the rate.  Wackenhut billed KBR, which then passed on the costs to the government under LOGCAP III.

The whistleblowers' share of the settlement will be $1.332 million.

A settlement has been reached to resolve False Claims for Federal Grants allegations against Big Brothers Big Sisters of America Corporation.

On January 21, 2016, the Justice Department announced, Big Brothers Big Sisters of America Corporation (Big Brothers) has agreed to pay the United States $1.6 million to resolve allegations of false claims for funds under Department of Justice grants awarded to help children at risk.

The United States alleges that Big Brothers violated these regulations and guidelines with respect to three grants awarded by the Justice Department from 2009 to 2011, by commingling the grant funds with general operating funds, failing to segregate expenditures to ensure that the funds were used as intended and failing to maintain internal financial controls to safeguard the proper use of those funds. 

Big Brothers has replaced its management team and put in place policies governing the use of federal grant funds as of 2013.

A settlement has been reached to resolve False Claims Act allegations against Novum Structures LLC.

The allegations arose from a lawsuit that claimed Novum Structures LLC improperly used foreign materials on construction projects using federal funds. This violates contractual provisions implementing various domestic preference statutes, often referred to colloquially as the “Buy America” requirements.

The head of the Justice Department’s Civil Division, Principal Deputy Assistant Attorney General Benjamin C. Mizer, stated “When taxpayer dollars are provided for construction projects, the government expects contractors to comply with all requirements, including ones that ensure the money remains in the U.S. economy”.

The whistleblowers' share of the settlement will be approximately $400,000.

A settlement has been reached to resolve False Claims Act allegations against URS E & C Holdings Inc.

On January 6 2016, the Justice Department announced, URS E & C Holdings Inc, a successor in interest to the global design and construction company Washington Group International Inc, has agreed to pay $9 million to settle allegations that Washington Group International submitted false claims in connection with United States Agency for International Development (USAID) contracts.

Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division stated “Contractors who misrepresent their eligibility for government contracts undermine the government procurement process,” and “The Justice Department will take action to protect that process and to ensure that taxpayer funds are not misused.”

A settlement has been reached to resolve False Claims Act allegations against University Furnishings LP.

The whistleblowers' share of the settlement will be approximately $2.25 million.

The allegations arose from a lawsuit that claimed University Furnishings made false statements to avoid paying duties on wooden bedroom furniture imported from the People’s Republic of China.

University Furnishings LP is a furniture company located in Dallas, Texas.

The IRS paid approximately $53 million to citizens who provided information on friends and neighbors for tax evasion in 2013.

The IRS website states, "The IRS Whistleblower Office pays money to people who blow the whistle on persons who fail to pay the tax that they owe. If the IRS uses information provided by the whistleblower, it can award the whistleblower up to 30 percent of the additional tax, penalty and other amounts it collects."

A whistleblowers' share of a settlement will be approximately $750,000.

The allegations arose from a lawsuit that claimed a state funded dredging project violated environmental laws.

The Whistleblower who was under contract with the state Department of Natural Resources as a land research consultant, alleged the water quality improvement project was in fact a million dollar oil and gas access canal project that benefited a group of landowners along the bayou.

A settlement has been reached to resolve False Claims Act allegations against Stericycle Inc.

The allegations arose from a lawsuit claiming Stericycle Inc overcharged government entities. Virginia will receive part of a $26.75 million settlement with Stericyle Inc, which also involves other states included in this case such as California, Delaware, the District of Columbia, Florida, Illinois, Indiana, Massachusetts, Nevada, New Jersey, North Carolina, Rhode Island, Tennessee and the federal government.

All entities involved will receive portions of the settlement. 

A settlement has been reached to resolve False Claims Act allegations against APL Limited.

The allegations arose from a lawsuit that claimed APL failed to properly provide GPS tracking of shipping containers in Afghanistan.

The Department of Defense used APL to track shipping containers sent from Karachi, Pakistan to U.S. military bases in Afghanistan. The Department of Defense claims APL Limited billed Department of Defense for the tracking services even though the tracking devices were not working properly.

Based in Scottsdale, Arizona, APL is an ocean carrier and wholly-owned American subsidiary of Singapore-based Neptune Orient Lines Limited.  

The allegations arose by a former Vanguard tax lawyer claiming Vanguard’s low fees are an illegal tax dodge and that Vanguard should have charged investors an extra $19.8 billion in investment fees this year and that Vanguard owes almost $35 billion in taxes, interest, and penalties since 2007.

Vanguard claims that it does not owe any corporate income taxes, but Vanguard may soon be required to pay back taxes because of the low fees it charged.

The whistleblowers' share of the settlement might be approximately $10 Billion.