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Contrack Int’l Will Pay $3.5 Million to Settle False Claims Act Allegations

July 29, 2013 — Our government works with private contractors regularly, but these government contracts also carry the risk of fraud. Government contractor fraud costs taxpayers money. Through the False Claims Act, the Justice Department works with tipsters and informants to attack government contractor fraud. Under the qui tam provisions of the federal False Claims Act, whistleblowers are permitted to file a lawsuit on behalf of the government and to receive a portion of the government’s recovery.

Design and Construction Firm Allegedly Evaded Prequalification Requirements in International Development Contracts

Virginia-based Contrack International, a global design and construction company, will pay $3.5 million to resolve allegations that the company submitted false claims in connection with its U. S. Agency for International Development (USAID) contracts, according to the Justice Department. The contracts were for construction of water and wastewater infrastructure projects in Egypt in the 1990s.

Bidders for the USAID-backed contracts were required to prequalify and, in some cases, prove that they were U.S. companies. However, the Contrack contracts were actually completed by a joint venture partnership that included an Egyptian company. The government has accused Contrack and its joint venture partners of hiding the identity of the partners to evade the prequalification requirements.

Federal authorities filed a lawsuit under the False Claims Act and the Foreign Assistance Act alleging that the joint venture partners evaded the prequalification requirement by concealing the identity of the joint venture partners, which prevented USAID officials from accurately assessing their qualifications. As a result, Contrack and its partners received USAID-backed contracts for which they were not eligible.

The government will continue to pursue allegations against the other two defendants named in the lawsuit.

Insiders to Government Contractor Fraud Can Help Stop False Claims Act Violations

Insiders need to understand their rights under the federal False Claims Act and the opportunities for collaborating with the government. The qui tam lawyers at Waters & Kraus offer skilled representation and counsel to whistleblowers every day. Contact us by email or phone our whistleblower attorneys at 855.784.0268 to learn how we can assist and guide you through this process.

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