The United States is the largest purchaser in the world, buying everything from battleships to office supplies. Government Procurement Fraud may occur when a contractor agrees to provide one or more of these goods and services on the government’s terms, but fails to comply with the government’s terms. These conditions to the contract are important before the contract is awarded, while it is ongoing, and in the delivery of whatever the government has procured. Failure to comply with any of these requirements may lead to a fraud on the government. For example:

A cornerstone of every government contract is that it must be free of Kickbacks/Bribes. When government contracts are corrupted by secret bribes or kickbacks, the essence of the contract is violated. Kickbacks may be the basis of liability under both the False Claims Act and the criminal Anti-Kickback laws.

The government also has a strong policy of promoting free and open competition. Bid Rigging, where competitors collude to allocate government business amongst themselves at agreed upon prices, deprives the government of competition. Contractors engaged in bid rigging may be in violation of both the False Claims Act and the antitrust laws.

Another important factor in awarding government contracts is the government’s interest in promoting certain kinds of businesses, like those owned by small businesses, women, minorities and veterans. When contractors false represent their eligibility for a government contract by representing themselves as having Minority Ownership, or being a Small Business, the contractor may be engaged in a fraud in getting that contract. Even if the contractor provides the product to the exact specifications set forth in the contract, it deprived the government of the ability to award that contract to the kind of business it intended, which is a fraud.

Once a contract is awarded, the contractor is required to comply with all terms set forth in that contract. Countless fraudulent schemes have been exposed involving contractors who tried to bypass their obligations under these contracts to increase profit. These include Failure to Follow Specifications, delivering Substandard Product or Service, failing to give the government Best Price, and overcharging Material or Labor Costs. All of these are potential violations of the False Claims Act.

Government contracts also must report on the contract’s progress on an ongoing basis. Providing False Progress Reports misrepresenting progress or compliance with laws regarding Prevailing Wages, and the Buy American Act may also amount to a fraud on the government. The following are common types of government contract fraud:

• Best Price Certification Fraud
• Bid Rigging
• Buy American Act
• Failure to Follow Specifications
• Falsifying Progress Reports
• Kickbacks and Bribes
• Disadvantaged Business Enterprises (DBE) Fraud
• Overcharging Material or Labor Cost Fraud
• Prevailing Wage and Benefits Fraud
• Small Business Administration Certification
• Worthless or Substandard Product Procurement Fraud

If you believe someone has engaged in one of these kinds of schemes – or some other scheme to commit procurement fraud, and you would like to learn more about or would like to bring a whistleblower lawsuit, the qui tam lawyers at Keller Grover LLP can help you. These whistleblower lawyers understand qui tam litigation, including the whistleblower protection provisions, and strive to achieve the best possible results for their clients.