Science Applications Int’l Corp. Has Paid $11.75 Million to Settle False Claims Charges

July 3, 2013 — Government contractors that file false claims with the government, for example by inflating charges, violate the federal False Claims Act. The False Claims Act is the mechanism that allows the government to work with tipsters and informants to fight fraud against the government. The qui tam provisions of the statute provide for financial rewards to whistleblowers who come forward to stop fraud—such as health care fraud or defense contractor fraud.

Inflated Charges for First Responder Training Lead to False Claims Act Allegations

Science Applications International Corporation (SAIC) has paid a total of $11.75 million to settle allegations that it violated the False Claims Act by charging the government inflated prices to train first responders to prevent and respond to terrorism attacks. Beginning in 2002, the New Mexico Institute of Mining and Technology (New Mexico Tech) obtained six federal grants from the Justice Department, the Federal Emergency Management Agency (FEMA), and the Department of Homeland Security to train first responders to prevent and respond to terrorism events that involve explosive devices.

New Mexico Tech subcontracted with SAIC to provide course development, management, and instruction. The U.S. government alleged that SAIC based its cost proposals on personnel costs that were much higher than SAIC actually expected because the company intended to use cheaper workers. This misrepresentation resulted in inflated charges—or false claims—against the U.S. government.

A former project manager for SAIC’s first responder training program filed a whistleblower lawsuit against SAIC under the False Claims Act’s qui tam provisions. These provisions let an insider file a lawsuit on behalf of the U.S. government and share in any recovery. The whistleblower’s share in this case has not yet been determined.

Insiders Use False Claims Act to Fight Fraud Against the Government

Insiders with information about violations of the False Claims Act need to understand their rights and the benefits of collaborating with the government. The experienced qui tam lawyers at Waters & Kraus can provide skilled representation to whistleblowers in government contractor fraud cases. Contact us by or phone our whistleblower attorneys at 855.784.0268 to learn more about how we can protect and assist you.

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