March 11, 2013 — Contracts with the federal government are a profitable business for civilian contractors. But overcharging for expenses is a violation of the federal False Claims Act. Accounting employees are especially well-situated to become aware of billing irregularities. Sometimes, contractors pay their employees to keep quiet or threaten them with the loss of their jobs. Fed up, many employees elect instead to notify the government.
Construction Company Resolves False Claims Investigation
Granite Construction Company has consented to pay a $367,500 settlement to resolve charges that the company overbilled the Department of Transportation and the Army Corps of Engineers on federal construction projects. Granite is a California-based company that builds airports, bridges, tunnels, and roads, often for the federal government. Between 2006 and 2008, Granite submitted claims for payment to the government that included inflated requests for equitable adjustment and change orders based on erroneous insurance rates for workers compensation and general liability coverage. The insurance rates were based on estimates that included cushion amounts that Granite was never forced to pay. As a result, the government should not have been billed for an amount its contractor — Granite — did not have to spend. The false claims Granite submitted involved construction projects located across the nation.
Employee Informants Use False Claims Act for Fighting Government Contractor Fraud
This was a case in which the wrongdoer, Granite, actually disclosed the overbillings to the Justice Department. In many cases involving the submission of false claims to the government, the disclosure is made by a company insider.
The federal False Claims Act authorizes tipsters to file a claim on the government’s behalf and participate in any recovery that results. The statute’s qui tam provisions reward contractor insiders with the courage to step forward.
Before filing suit, government collaborators need to understand their legal rights. The knowledgeable lawyers at Waters & Kraus are dedicated to representing whistleblowers in government contractor fraud cases. Contact us or call our whistleblower attorneys at 855.784.0268 to learn how we can assist and protect you.