Defense contract fraud costs the federal government billions. The Department of Defense depends heavily on private contractors for military equipment and services. In fact, the military’s contract spending last year was nearly $450 billion. The “Big Five” defense contractors took in more than $150 billion of this budget (Lockheed Martin, General Dynamics, Raytheon, Boeing, and Northrop Grumman). Some private contractors have a long history of abusing the system by improperly billing the military. This type of greed harms American taxpayers and often puts America’s troops and personnel stationed at home and abroad in unnecessary danger. To stop defense contractor fraud, the government allows whistleblowers to file lawsuits under the False Claims Act and to recover significant awards for alerting the government to the fraud.
Defense contract fraud occurs when a private company is awarded a contract from the U.S. military and then cheats the military out of money by improperly billing for goods or services.
Defense contract fraud can take on many forms but usually involves (1) a contractor lying about the quality of a good or service, (2) a contractor over-billing the government for a good or service, or (3) a contractor otherwise falsely certifying that it complied the terms of the contract. The following list contains some types of defense contractor fraud that we have seen over the years. This list is by no means exhaustive, and if you suspect that a defense contractor is taking advantage of the government, you should contact an whistleblower attorney to determine if the contractor is in fact committing fraud.
If a whistleblower wants to report defense contract fraud, there are a number of steps that the whistleblower should take. We have found that the following steps are helpful in evaluating and preparing defense contract fraud cases.
We have successfully represented clients in whistleblower claims and litigation in districts across the United States. Our firm has offices in Atlanta GA, Brunswick GA, Alexandria VA, and Washington DC, and we frequently travel to other cities and states to help whistleblowers file claims and recover rewards. Contact our firm and we will let you know if we can help. If we are not the best firm for your case, we will let you know what lawyer or law firm would be right for your case and we will refer you to them at no additional cost to you.
False Claims Act cases involving defense contractor fraud remain a top priority for the Department of Justice. While defense contractor cases are normally dwarfed by the number and size of healthcare fraud cases, the Department of Justice takes a keen interest in these cases due to the potential impact on national security and the safety of American troops.
Last year saw several significant defense contractor fraud cases. In one case, Unitrans International agreed to pay $27 million to resolve allegations that it induced the U.S. Army into awarding contracts for food by falsely certifying that it was complying with sanctions against Iran. In another case, Bradken Inc., agreed to pay $10.8 million to settle allegations that it used substandard steel in U.S. Navy vessels. The Navy contracts specifically required that Bradken use grades of high yield steel. The government alleged that Bradken engineers falsified the results of tests designed to ensure that the steel was adequate.
As the Bradken case demonstrates, it is very easy for contractors to get away with selling the government inferior products unless a whistleblower steps forward. For that reason, this type of defense contractor fraud will unfortunately remain common. This type of fraud also accounts for one of the largest defense contractor fraud cases in history, which involved Northrop Grumman Corp. In 2009, Northrop Grumman agreed to pay $325 million for allegations that it sold the government defective satellite parts. The whistleblower who filed that False Claims Act lawsuit walked away with nearly $50 million for alerting the government to the fraud.
In the coming years, we expect to see an increasing number of cases involving cybersecurity. Due to the increasing number of cyberattacks, federal agencies are placing a great deal of importance on contracts that demand certain security certifications and specifications. If a contractor is non-compliance with cybersecurity terms of a contract, this could give way to liability under the False Claims Act. Time will tell if this theory of liability proves to be the next big wave of cases in defense contractor fraud.
Page Pate and his partner Jess Johnson are top notch! Both are brilliant attorneys with incredible integrity. Page represented me in a successful 5 year long Whistleblower False Claims Act Case. Despite his busy schedule and prestigious reputation as one of the best Federal Trial Lawyers in the US, Page was unbelievably polite, respectful and took the time to listen, explain the process in its entirety and answer any questions. Page saw the potential of my case where the others didn’t. He and Jess worked very long hours preparing the claim, researching, making phone calls and attending meetings with me to assist the DOJ. I am still thanking God every day for Page Pate and Jess Johnson and their belief in me and their ability to make a $25M case out of what other expert Qui Tam attorneys saw as impossible.
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