Contractor Settles $1 Million FCA Action for Overbilling NSA For Work Performed by Personnel Who Lacked Required Certs

July 24, 2020

According to a recent U.S. Department of Justice ("DoJ") press release, a Maryland defense contractor agreed to pay nearly $1 million to resolve False Claims Act ("FCA") allegations that the company knowingly billed the National Security Agency ("NSA") for services performed by the contractor's employees who "did not meet all of the specialized qualifications required under their contract with NSA."

 

The press release provided the following details regarding the civil settlement agreement:

 

  • According to the civil settlement agreement, the settlement resolves the allegation that between November 9, 2012 and April 14, 2016, [the contractor] knowingly billed the NSA, and the NSA paid, for work performed by [the contractor's] employees who were identified by [the contractor], on the invoices it presented to the NSA, as System Administrator-IV (“SA-IV”) and System Administrator-III (“SA-III”) positions, despite the fact that those employees did not timely obtain a specific certification required for payment of the rates corresponding to those two labor categories. 

 

Takeaway

 

The civil FCA is one arrow in the Government's quiver to combat fraud. [1]  Given the above settlement, small and large contractors – in both the defense and civilian markets – should assess your contractual obligations to determine whether your personnel meet any credential or qualification requirements to be eligible for certain labor categories/rates. Failure to adhere to those contractual obligations could result in an FCA action by the Government or by a qui tam whistleblower.  

 

If you think the Government doesn't pay attention to these contractual details, think again.

 

__________

 

[1]  Broadly, the FCA creates liability where a person "knowingly presents, or causes to be presented, a false or fraudulent claim for payment or approval."  31 U.S.C. § 3729(a)(1)(A). Persons who violate the FCA are liable for a civil penalty between $11,665 and $23,331 per false claim plus trebling (3x) of damages sustained by the Government.  31 U.S.C. § 3729(a)(1) (penalties adjusted in 2020).

 

. . .

 

#govconjudicata #govcon #falseclaimsact #fca

 

 

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