If you are planning to defraud the U.S. Government (and I certainly hope that you are not), your best bet is to avoid the U.S. Department of Transportation’s Disadvantaged Business Entity program.
Yesterday, the Department of Justice announced that a DOT DBE subcontractor had agreed to settle “pass-through” fraud claims for $936,000. The DOJ’s announcement comes on the heels of a June 6 press release touting a settlement of nearly $3 million, also stemming from alleged DOT DBE fraud.
An Idaho contractor has been indicted on federal charges stemming from allegations that she fraudulently lowered her personal net worth in order to enable her company to be certified in the SBA 8(a) Program and the Department of Transportation’s Disadvantaged Business Enterprise Program.
According to a Department of Justice press release, the 8(a) and DBE fraud netted the contractor upwards of $9 million–and the Government wants its money back.
An Alabama-based construction company has agreed to pay more than a million dollars to settle allegations that it violated the False Claims Act by fraudulently representing that it was mentoring a minority-owned small business under the Department of Defense’s mentor-protege program.
The settlement puts to rest the Justice Department’s False Claims Act contention that the contractor used its so-called “protege” as little more than a pass-through entity and failed to provide real mentoring services to the small business.
False or incorrect women-owned small business self-certifications may be a significant government-wide problem, according to a recent audit report issued by the NASA Office of Inspector General.
The NASA OIG report states that in a study of sampled awards to self-certified WOSBs, 7 out of 20 awardees, or 35 percent, “may not have met the criteria for a woman-owned small business.” Noting that these firms won nearly $75 million in government business in 2010 alone, the NASA OIG has referred its report to the SBA and GAO, concerned about a “potential Government-wide effect of this condition.” Continue reading
A man who lied about being a service-disabled veteran–and received nearly $6 million in VA SDVOSB set-asides–will not spend a single day in jail.
According to a Department of Justice press release, the man in question, John Witty, was sentenced to a fine, probation, and community service. Yes, Witty’s wallet will be lighter, and maybe there were extenuating circumstances not evident from the press release–but the lack of jail time seems a tad generous.
Two Kentucky-based government contractors and their owners have agreed to pay $6.25 million to settle HUBZone fraud claims, according to a U.S. Department of Justice press release.
The costly settlement puts an end to a saga involving DOJ claims of a vacant “principal” office, undisclosed affiliation, and fraudulent statements made to the SBA and and the U.S. Army.
An Idaho man has pleaded guilty to a HUBZone fraud charge. According to a U.S. Department of Justice press release, last week, Patrick Large, the owner of Quality Tile and Roofing Inc., pleaded guilty to one count of wire fraud resulting from a HUBZone scheme.
Large admitted defrauding the government by falsely representing the location of two employees, apparently in order to satisfy the SBA’s “principal office” requirement for HUBZone firms. Based on Large’s representation, the SBA admitted Quality Tile to the HUBZone program. Quality Tile subsequently won a HUBZone set-aside contract valued at approximately $220,000.
As part of the guilty plea, Large agreed to pay $150,000 in restitution. However, he still faces the possibility of additional penalties, including prison time. He is scheduled to be sentenced on January 8, 2013.