Overseas Civilian Contractors

News and issues relating to Civilian Contractors working Overseas

United States Sues Virginia-based Contractor Triple Canopy for False Claims Under Contract for Security in Iraq

Allegedly Billed US for Security Guards Who Did Not Meet Contract Requirements

Contractor Faked Guard Weapon Tests In Iraq, US Says

Department of Justice  October 31, 2012

The United States has filed a complaint against a Virginia-based contractor alleging that the company submitted false claims for unqualified security guards under a contract to provide security in Iraq, the Justice Department announced today. The company, Triple Canopy Inc. is headquartered in Reston, Va.

In June 2009, the Joint Contracting Command in Iraq/Afghanistan (JCC-I/A) awarded Triple Canopy a one-year, $10 million contract to perform a variety of security services at Al Asad Airbase – the second largest air base in Iraq. The multi-national JCC-I/A was established by U.S. Central Command in November 2004, to provide contracting support related to the government’s relief and reconstruction efforts in Iraq.

The government’s complaint alleges that Triple Canopy knowingly billed the United States for hundreds of foreign nationals it hired as security guards who could not meet firearms proficiency tests established by the Army and required under the contract. The tests ensure that security guards hired to protect U.S. and allied personnel are capable of firing their AK-47 assault rifles and other weapons safely and accurately. The government also alleges that Triple Canopy’s managers in Iraq falsified test scorecards as a cover up to induce the government to pay for the unqualified guards, and that Triple Canopy continued to bill the government even after high-level officials at the company’s headquarters had been alerted to the misconduct. The complaint further alleges that Triple Canopy used the false qualification records in an attempt to persuade the JCC-I/A to award the company a second year of security work at the Al Asad Airbase.

“For a government contractor to knowingly provide deficient security services, as is alleged in this case, is unthinkable, especially in war time,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division of the Department of Justice. “The department will do everything it can to ensure that contractors comply with critical contract requirements and that contractors who don’t comply aren’t permitted to profit at the expense of our men and women in uniform and the taxpayers at home who support them.”

“We will not tolerate government contractors anywhere in the world who seek to defraud the United States through deliberate or reckless conduct that violates contractual requirements and risks the security of government personnel,” said Neil H. MacBride, U.S. Attorney for the Eastern District of Virginia.

The government’s claims are based on a whistleblower suit initially filed by a former employee of Triple Canopy in 2011. The suit was filed under the qui tam, or whistleblower, provision of the False Claims Act, which allows private persons to file suit on behalf of the United States. Under the act, the government has a period of time to investigate the allegations and decide whether to intervene in the action or to decline intervention and allow the whistleblower to go forward alone.

This matter was investigated by the U.S. Attorney’s Office for the Eastern District of Virginia; the Commercial Litigation Branch of the Justice Department’s Civil Division; and the Army Criminal Investigative Command (CID) and Defense Criminal Investigative Service (DCIS) of the Department of Defense.

The claims asserted against Triple Canopy are allegations only; there has been no determination of liability. The government is not aware of any injuries that occurred as a result of the alleged misconduct.

The lawsuit was filed in the U.S. District Court for the Eastern District of Virginia in Alexandria, and is captioned United States ex rel. Badr v. Triple Canopy, Inc.

November 1, 2012 Posted by | Civilian Contractors, Contractor Oversight, Department of Defense, Government Contractor, Iraq, Lawsuits, Private Security Contractor, Safety and Security Issues, Vetting Employees, Whistleblower | , , , , , , , | 1 Comment

Whistleblower Exposed Fraud By The Louis Berger Group; $69.3 Million Settlement Sets Record for Afghanistan and Iraq Contractor Fraud Case

BALTIMORE, Nov. 5, 2010 /PRNewswire/ — A whistleblower lawsuit was the basis for the federal government’s fraud case against the Louis Berger Group that settled today for $69.3 million — the largest recovery in a case involving war-zone contractors in Afghanistan and Iraq.

The “qui tam” (whistleblower) lawsuit against Louis Berger was filed in 2006 “under seal” as the False Claims Act requires in qui tam cases, so it wasn’t publicly known until today when the court lifted the seal and the record settlement was announced. Louis Berger has agreed to pay $46.5 million to settle the whistleblower case, $4.1 to settle other contractual disputes and $18.7 million for a criminal fine.

The whistleblower, Harold Salomon, was a senior financial analyst/auditor for Louis Berger in New Jersey. His lawsuit exposed Louis Berger’s practice of billing the government for indirect and overhead costs that were unrelated to its government contracts. Louis Berger has some of the biggest U.S. contracts for rebuilding projects in Afghanistan.

“Today I can affirm to those who told me the Louis Berger Group can get away with anything that they were wrong,” said Salomon. “To those who said, ‘If you cannot beat them, you have to join them,’ I say they were wrong, too.”

Fraud, waste and abuse by war-zone contractors is estimated to cost U.S. taxpayers billions of dollars. But fraud cases can be difficult to pursue because of the chaos of war, the lack of a paper trail and other factors. A Department of Justice official estimated earlier this week that the U.S. has recovered only $80 million from cases involving U.S. contractors in Iraq and Afghanistan (excluding the Louis Berger settlement).

“Louis Berger manipulated its accounting system and overhead rate to steal millions from the federal government – money that was supposed to be used to rebuild Afghanistan,” said Peter W Chatfield, a Washington, DC, attorney with Phillips & Cohen, which represented the whistleblower. “The government never would have uncovered this sophisticated scheme without an insider such as our client, Harold Salomon, who had the knowledge and the integrity to stop the fraud.”

Louis Berger’s fraud hurt the U.S. war effort, said Tim McCormack, another Washington, DC, attorney with Phillips & Cohen.

“Fraud undermines U.S. efforts in Afghanistan and Iraq,” said McCormack. “Money that should have been used to build roads, clinics and schools in Afghanistan to win support of the Afghan people was used instead to build Louis Berger’s profits.”

Chatfield and McCormack commended the government attorneys and investigators who worked on the case, particularly Michael DiPietro and Tarra Deshields from the U.S. Attorney’s Office in Baltimore, Russell Kinner from the Department of Justice and the investigative teams from the U.S. Agency for International Development and the Defense Contract Audit Agency.

“This was a true team effort,” Chatfield said. “The government attorneys and investigators invested an incredible amount of time and effort into this case. They worked diligently with Mr. Salomon to unwind this sophisticated, fraudulent scheme.”

The False Claims Act allows whistleblowers to sue companies that are defrauding the government and receive a reward if the government recovers any funds as a result. Salomon plans to donate a portion of his reward to the American-Haitian Association for Medical Economic & Educational Support (www.ahames.org), a non-profit group he founded that provides health care and funds various economic development projects in Haiti.

“It is a blessing to have the opportunity to contribute a little to society and at the same time reach out to those in need thru AHAMES,” Salomon said.

Phillips & Cohen represents whistleblowers nationwide in False Claims Act cases and in claims involving tax law and securities law violations made under the Internal Revenue Service’s and the Securities and Exchange Commission’s whistleblower reward programs. It is the nation’s most successful law firm representing whistleblowers. The firm’s whistleblower cases have recovered more than $6.89 billion in civil settlements and related criminal fines and have earned its clients more than $730 million in rewards. For more information, see www.phillipsandcohen.com.

See Harold Salomon’s full statement at http://www.phillipsandcohen.com/CM/NewsSettlements/NewsSettlements618.asp.

Settlement agreement is posted at http://www.phillipsandcohen.com/CM/NewsSettlements/Louis%20Berger%20civil%20settlement%20agreement.pdf.

SOURCE Phillips & Cohen LLP

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November 5, 2010 Posted by | Afghanistan, Civilian Contractors, Contractor Corruption, Whistleblower | , , , | 1 Comment

Recent Iraq Contract Decisions Expand Opportunities and Defenses for Contractors

McKenna, Long, and Aldridge News

Government contractors performing in Iraq or elsewhere overseas may benefit from the holdings and logic of two recent federal court decisions.

In the first decision, the Fourth Circuit Court of Appeals held that a qui tam relator had failed to state a valid False Claims Act (“FCA”) claim against a construction contractor that built the U.S. Embassy in Baghdad, Iraq.

In the second decision, the United States District Court for the Eastern District of Virginia held that a contractor providing brokerage services for the Iraqi Ministry of Defense could pursue a breach of contract claim against the Iraqi government because the Iraqi government was not immune from suit under the Foreign Sovereign Immunities Act (“FSIA”).

Read the entire post here

July 27, 2010 Posted by | Civilian Contractors, Iraq, Legal Jurisdictions | , , , , , | Leave a comment