Monday, April 24, 2006

Company that posed as small business to pay $1 million in FCA settlement

Insight Public Sector has agreed to pay $1 million for misrepresenting itself as a small business in order to win a government contract. The company was known as Comark Government and Education Services, Inc. back in 1996 when it obtained a General Services Administration contract. Comark was acquired by Insight Enterprise Inc. in 2002. Insight had 2005 revenues of $3.3 billion.

An investigation by GSA, the Justice Department and the Small Business Administration concluded that Comark was not a small business when it won the contract and should not have received preferential treatment. An attorney who worked on the investigation said that between 1996 and 2005 the company received roughly 250 small-business set asides worth about $4.2 million.

Additional details regarding the investigation and settlement can be found in the April 24, 2006 issue of Wahington Technology.

Monday, April 17, 2006

Whistle-blower suit alleges Boeing installed faulty parts in military planes

A law suit filed by whistle-blowers under the qui tam provisions of the False Claims Act alleges that Boeing installed defective parts, supplied by AHF Ducommun, in civilian and military planes. The Washington Post, which reported on the suit on May 28, 2005 (see False Claims Act/Qui Tam Blog archives), published an article detailing developments on April 17, 2006.

The FAA and Pentagon looked into the charges and each said their investigation found no reports of problems. The Post says that their own review found that the FAA did not assess many of the whistle-blowers' key allegations and that the Pentagon and the Dept. of Transportation relied on the FAA report.

The FAA re-opened their investigation last year but it has not yet been completed.

Clark Atlanta University to pay $5 million in settlement of whistleblower suit

Clark Atlanta University has agreed to pay $5 million to settle a federal whistleblower suit that claimed the university misused federal funds. Clark Atlanta had been acting as the manager for a consortium of universities that received $24 million from the Department of Energy to train a monority workforce in the environmental sciences. The suit alleged that Clark Atlanta did not use the money for that purpose.

The whistleblower who filed the suit, Dr. August Curley, who was hired by Clark Atlanta as Program Manager for the Consortium in 1995, will receive 22 percent of the recovery.

The Office of the U.S. Attorney in Atlanta issued a press release on April 14, 2006.

Thursday, April 13, 2006

Universal Health subsidiary settles cost report suit

UHS of Delaware, Inc., a subsidiary of Universal Health Services, has settled a suit that alleged overcharging at a Georgia drug and alcohol treatment center.

The company agreed to pay nearly $1.5 million to settle charges that UHS's Turning Point Care Center billed Medicare for non-reimbursable costs such as patient transportation, self-administered drugs and costs of an outpatient facility that was not Medicare certified.

A copy of the April 10, 2006 settlement agreement and the government's press release can be found at the website of the U.S. Attorney's Office for the Eastern District of Pennsylvania.

Monday, April 10, 2006

John Wayne Airport FCA suit settles for $2.5 million

Sequel Contractors, a paving company, and JHTM & Associates, the project manager for Orange County's John Wayne Airport, have agreed to pay $2.6 million to settle a whistleblower suit.

The suit alleged that the companies conspired to inflate Sequel's invoices for paving contracts and used the money to pay kickbacks to the JHTM project manager.

The whistleblower suit was brought by Sialic Contractors, who will recieve $697,662 as their relator's share.

More on the settlement can be found in the April 8, 2006 edition of the Los Angeles Times.

Thursday, April 06, 2006

Senate Committee holds hearing on Medicaid fraud control efforts

A Senate subcommittee held hearings on March 28, 2006 on the Center for Medicare and Medicais Services' program to control Medicaid fraud at both the state and federal levels. The U.S. Senate Committee on Homeland Security and Governmental Affairs' Subcommittee on Federal Financial Management, Government Information, and International Security heard from the Dept. of Health & Human Services' Inspector General, the director of the Center for Medicaid and State Operations, and others.

The amount lost each year to fraud and abuse is staggering. The CMS estimates that between $15 billion and $24 billion is lost each year from the $300 billion program.

Witnesses testimony is available at the Committee's hearing page.