Government Contracting Fraud
There has been a rapid growth in government contracting over the last few decades, as successive administrations have chosen to outsource many government functions. With this growth has come increased opportunity for contracting fraud, where contractors mismanage government money or power, or fraudulently provide services or products. Government contract fraud hurts taxpayers and the government.
BEST PRICE VIOLATIONS
Many government agencies buy goods and services through GSA Schedules which cover everything from computers to hospital supplies. GSA regulations require sellers to give the federal government the “best price” available to their commercial customers. Failure to do so can result in liability for hundreds of millions of dollars under the False Claims Act. Ashcraft & Gerel has extensive experience in this area of practice, including a $128 million settlement in the Network Appliance, Inc. best price case.
TRADE AGREEMENT ACT FRAUD
Contractors who sell to the government usually must ensure that the goods are produced in countries which have trade agreements with the United States, a requirement that excludes products from China, which does not have an agreement with the U.S. Ashcraft & Gerel also has substantial expertise in Trade Agreement Act cases.
Billing fraud can take many forms, ranging from billing the government at inflated rates, to billing for work never performed. The most common type of fraud involves switching costs from firm fixed price contracts to cost plus contracts to cut a contractor’s losses.
DAVIS-BACON ACT VIOLATIONS
This 1931 Act requires all federal contractors to pay construction workers prevailing wages. Violations of the Davis-Bacon Act also violate the False Claims Act (FCA), because the government pays the contractor the full prevailing wage under the contract. Ashcraft & Gerel attorneys frequently counsel their many union clients about DBA violations.