Procurement Fraud

Every year, federal and state governments spend hundreds of billions of dollars on a variety of goods and services that range from health care and education to military defense and cybersecurity. And every year, some government contractors and subcontractors engage in fraudulent schemes that undermine these government contracts and line their pockets at the expense of the public.

The federal and state False Claims Acts provide the government a powerful remedy for these frauds, and they include financial incentives for whistleblowers.

These fraud schemes can take many different forms, but they generally fall into the following two categories:

Lying About the Goods or Services Provided

One common way contractors can cheat the government is by lying about the goods or services they are providing. That can take a few different forms. 

First, they may misrepresent the goods or services provided or falsely claim that they meet important contractual or quality assurance and testing requirements. A classic example is selling the government guns that don’t shoot.

Second, they may misrepresent that their goods or services comply with state and federal regulatory regimes including:

  • Cybersecurity requirements imposed by state and federal governments;

  • The Buy American Act, trade agreements, and other expert control laws;

  • The Davis-Bacon Act and other prevailing wage requirements.

Third, they may inflate their payments from the government by lying about the costs necessary to provide the goods or services, such as:

  • Artificially inflating costs that are passed through to the government;

  • Cross charging or shifting costs between government contracts;

  • Misallocating costs from private contracts to government payors.

Fourth, contractors may illegally overstate the prices the government should pay for the goods or services by violating rules that mandate specific discounts for government payors, such as:

  • “Most favored customer” or “best pricing” requirements;

  • Price reduction clauses;

  • Truth in Negotiation Act requirements.

Lying to Get or Keep a Government Contract

The second type of common government contracting fraud involves lying or cheating to get a contract. This type of fraud can include all manner of misrepresentations, but it often falls into one of a few categories, including:

  • Misrepresentations about a contractor’s or subcontractor’s ability to perform on a contract;

  • Misrepresentations regarding a contractor’s or subcontractor’s disadvantaged business status, such as false claims of being a small business or minority-, woman-, or service-disabled veteran-owned business;

  • Bid-rigging or bribery schemes.

Whistleblower Partners attorneys have decades of experience in government procurement fraud cases

The experienced advocates at Whistleblower Partners have successfully brought many of the largest government contracting enforcement actions over the last several decades.

Whistleblowers play a critical role in stopping government procurement fraud and returning misappropriated funds. Since 1987, the False Claims Act has recovered more than $75 billion for the government, and more than 70% of those damages came from whistleblower-initiated lawsuits. In return, the federal government has awarded nearly $9 billion in relator share awards to whistleblowers who have brought successful cases. In addition, many states and municipalities have False Claims Acts that have successfully recovered fraudulently paid funds.

If you’ve witnessed procurement fraud and would like to alert the Government, it might make sense for you to file a False Claims Act case. The attorneys at Whistleblower Partners have decades of False Claims Act experience and can help you decide how to move forward. If you would like more information or to speak to an attorney at Whistleblower Partners, please contact us for a confidential consultation.