Give yourself credit if you guessed “ArmorGroup North America Inc.” (AGNA) and the “Lord of the Flies” environment they oversaw in the housing camp for U.S embassy guards in Kabul, Afghanistan, which our friends over at the Project On Government Oversight (POGO) exposed back in 2009.
Earlier this month, AGNA, the private security company and subsidiary of the British security services conglomerate G4S, settled a whistleblower’s lawsuit associated with the scandal, agreeing to pay a $7.5 million fine. Importantly, though, the contractor settled the suit without an admission of fault or liability, effectively sweeping the incident under the rug with regard to future considerations of government contracts
Any future contracting officials seeking to determine ArmorGroup’s integrity and trustworthiness will not see the incident listed in the government’s top contracting performance database, the Federal Awardee Performance and Integrity Information System (FAPIIS).
Currently, FAPIIS only displays lawsuits or administrative actions taken by federal, state, or local governments where there is an admission of fault or liability by the contractor. And guess what contractors always demand whenever they settle something out of court; yup, immunity from any finding of fault, keeping many of the worst contracting abuses out of the government’s databases and away from the eyes of contracting officials.
In AGNA’s case, that includes allegations of the company blatantly disregarding “its obligations to ensure the safety and security of the U.S. Embassy in Kabul” – according to the whistleblower who sued – and various other nefarious wrongdoings – according to the Department of Justice (DOJ). Offenses include:
- “AGNA submitted false claims for payment on a State Department contract to provide armed guard services at the U.S. Embassy in Kabul, Afghanistan”;
- “[I]n 2007 and 2008, AGNA guards violated the Trafficking Victims Protection Act (TVPA) by visiting brothels in Kabul, and that AGNA’s management knew about the guards’ activities”;
- “AGNA misrepresented the prior work experience of 38 third country national guards it had hired to guard the Embassy”; and
- “AGNA failed to comply with certain Foreign Ownership, Control and Influence mitigation requirements on the embassy contract, and on a separate contract to provide guard services at a Naval Support Facility in Bahrain.”
Those seem like some important pieces of information that a contracting official might want to take into consideration if choosing between ArmorGroup and one of its modestly more responsible competitors when determining the award of a future federal contract.
Of course, contracting officials – and the public for that matter – could see this information if Congress simply passed some common sense contracting transparency reforms. Last spring, then-Sen. Russ Feingold (D-WI) introduced a bi-partisan bill including just such reforms.
Included in the legislation was language to pull into FAPIIS “records of any administrative proceeding entered into by a contractor at any level of government” no matter the finding of fault or liability. There was also a provision “increasing the length of time from five years to 10 that a contractor’s past performance record on a government contract” would stay in the database.
The legislation ingloriously died in committee, however, and with Sen. Feingold now out of the Senate, the transparency community needs a new champion to step up in Congress and push for these basic contracting reforms.
Armor Group North America and Its Affiliates Pay $7.5 Million to Resolve False Claims Act Allegations
WASHINGTON – Armor Group North America Inc. (AGNA) and its affiliates have paid the United States $7.5 million to resolve allegations that AGNA submitted false claims for payment on a State Department contract to provide armed guard services at the U.S. Embassy in Kabul, Afghanistan, the Justice Department announced today.
The settlement resolves U.S. claims that in 2007 and 2008, AGNA guards violated the Trafficking Victims Protection Act (TVPA) by visiting brothels in Kabul, and that AGNA’s management knew about the guards’ activities.
The settlement also resolves allegations that AGNA misrepresented the prior work experience of 38 third country national guards it had hired to guard the Embassy, and that AGNA failed to comply with certain Foreign Ownership, Control and Influence mitigation requirements on the embassy contract, and on a separate contract to provide guard services at a Naval Support Facility in Bahrain.
The settlement resolves a whistleblower suit filed in the U.S. District Court for the District of Columbia. The lawsuit was initially filed under seal by James Gordon against AGNA, ArmorGroup International plc, G4S plc and Wackenhut Services Inc. under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals, called “relators”, to bring lawsuits on behalf of the United States and receive a portion of the proceeds of a settlement or judgment awarded against a defendant. Mr. Gordon will receive $1.35 million of the settlement proceeds. During 2007 and early 2008, Mr. Gordon was employed by AGNA, as its director of operations.
The case remained under seal to permit the United States to investigate the allegations and determine whether it would join the lawsuit. Under the False Claims Act, the United States may recover three times the amount of its losses, plus civil penalties. On April 29, 2011, the
United States joined the suit.
“These contracts are put in place to provide essential support to personnel who are serving in our missions overseas,” said Tony West, Assistant Attorney General for the Civil Division. “The Department of Justice will actively pursue its legal remedies where contractors falsely claim taxpayer dollars for services that fall short of material requirements in their government contracts.”
“Americans deserve to know that their tax dollars are being spent wisely and consistent with our values,” said U.S. Attorney Ronald C. Machen Jr. “Our office has targeted government contractors who fail to meet their obligations to the American people. With this settlement, the U.S. Attorney’s Office for the District of Columbia has now recovered more than $140 million in False Claims Act cases so far this year.”
“The Department of State appreciates the work done by the Department of Justice and the Office of the Inspector General in bringing this case to resolution. The Department of State takes any allegation of contractor misconduct seriously and works as part of the inter-agency community to ensure it is adjudicated properly,” said Ambassador Eric J. Boswell, Assistant Secretary of State for Diplomatic Security.
The Deputy Inspector General for the Department of State, Harold Geisel, said, “We’re pleased with the successful resolution of this case, and I commend the dedication of our OIG investigators. Our efforts should reinforce to American taxpayers that oversight of their tax dollars is taken seriously.”
Assistant Attorney General West and U.S. Attorney Machen thanked the joint investigation team, which includes Special Agents with the Department of State Office of Inspector General, and representatives from the Department of State and the Department of the Navy, for their efforts in the investigation of this matter.