The Contracting Education Academy

Contracting Academy Logo
  • Home
  • Training & Education
  • Services
  • Contact Us
You are here: Home / Archives for misrepresentation

March 22, 2021 By cs

GAO report suggests DOE should identify more instances of contractor fraud

The Government Accountability Office (GAO) has issued a report on Department of Energy (DOE) contracting, entitled “Improvements Needed to Ensure DOE Assesses Its Full Range of Contracting Fraud Risks.”

The thrust of the report is that DOE should do more to prevent and detect fraud, particularly in less-examined areas such as bid-rigging, misrepresentation of eligibility, kickbacks and gratuities, and conflicts of interest.

DOE relies on contractors to carry out its missions at laboratories and other facilities, spending approximately 80 percent of its $41 billion in total obligations on contracts.  In March 2017, GAO reviewed DOE’s approach to managing its risk of fraud and found DOE did not use leading practices, resulting in missed opportunities to mitigate the likelihood and impact of fraud.

In its most recent report, GAO examined DOE’s processes for managing contracting fraud risks and concluded that DOE has not assessed the full range of fraud risks it faces.

Despite some improvements toward combating fraud in response to GAO’s March 2017 recommendations, GAO noted that the agency’s methods for gathering information capture only top fraud risks and fail to obtain information on fraud risks for non-management and operating (M&O) contractors.

GAO reviewed nine categories of contracting fraud schemes that occurred at DOE sites, and found that DOE’s risk profiles for FY 2018 and 2019 captured five of these nine fraud schemes (billing schemes, payroll schemes, product quality, theft, contract progress schemes), but failed to capture four others: bid-rigging, misrepresentation of eligibility, kickbacks and gratuities, and conflicts of interest. The report urges DOE to give these other areas greater focus in its fraud risk planning.

Keep reading this article at: https://governmentcontractsnavigator.com/2021/01/19/gao-report-suggests-doe-should-identify-more-instances-of-contractor-fraud/

Filed Under: Government Contracting News Tagged With: abuse, bid rigging, conflict of interest, DOE, Energy Dept., fraud, GAO, gratuity, kickback, misrepresentation, waste

June 16, 2020 By cs

Former DEA official pleads guilty to $4 million contract-related fraud scheme

A former Drug Enforcement Administration (DEA) public affairs officer, Garrison Courtney, has pleaded guilty to defrauding at least a dozen companies of over $4.4 million by posing falsely as a covert officer of the Central Intelligence Agency (CIA).

According to court documents, Garrison Courtney of Tampa Florida falsely claimed to be a covert officer of the CIA involved in a highly-classified program or “task force” involving various components of the intelligence community and the Department of Defense.  According to the false story told by Courtney, the supposed classified program sought to enhance the intelligence gathering capabilities of the United States government.  In truth, Courtney had never been employed by the CIA, and the task force that he described did not exist.

To accomplish the fraud, Courtney approached numerous private companies with some variation of this false story, and claimed that the companies needed to hire and pay him to create what Courtney described as “commercial cover” in order to mask his supposed affiliation with the CIA.  Courtney also fraudulently claimed that the companies would be reimbursed in the future for these salary payments, sometimes by the award of lucrative contracts from the government in connection with the supposedly classified program.

Courtney went to extraordinary lengths to perpetuate the illusion that he was a deep-cover operative.  Among other things, he:

  • falsely claimed that his identity and large portions of his conduct were classified;
  • directed victims and witnesses to sign fake nondisclosure agreements that purported to be from the government and that forbade anyone involved from speaking openly about the supposedly classified program;
  • told victims and witnesses that they were under surveillance by hostile foreign intelligence services;
  • made a show of searching people for electronic devices as part of his supposed counterintelligence methods;
  • demanded that his victims meet in sensitive compartmented information facilities to create the illusion that they were participating in a classified intelligence operation;
  • repeatedly threatened anyone who questioned his legitimacy with revocation of their security clearance and criminal prosecution if they “leaked” or continued to look into the supposedly classified information; and
  • created fake letters, purporting to have been issued by the Attorney General of the United States, which claimed to grant blanket immunity to those who participated in the supposedly classified program.

In furtherance of his scheme, Courtney created a fraudulent backstory about himself, claiming that he had served in the U.S. Army during the Gulf War, had hundreds of confirmed kills while in combat, sustained lung injuries from smoke caused by fires set to Iraq’s oil fields, and that a hostile foreign intelligence service had attempted to assassinate him by poisoning him with ricin.  All of these claims were false.

Courtney also convinced several real governmental officials that he was participating in an intelligence “task force” and asserted that they had been selected to participate in the program.  He then used those officials as unwitting props falsely to burnish his legitimacy.  For example, he directed his victims to speak with the government officials he recruited in order to verify his claims, having separately instructed those officials exactly what to say.  Courtney thereby created the false appearance to the victims that the government officials had independently validated his story, when in fact the officials merely were echoing the false information fed to them by Courtney.  At times, Courtney also convinced those officials to meet with victims inside secure government facilities, thereby furthering the false appearance of authenticity.

Through the scheme, Courtney also fraudulently gained a position working as a private contractor for the National Institutes of Health (NIH) Information Technology Acquisition and Assessment Center (NITAAC), a branch of NIH that provides acquisition support services to federal agencies.  Once he had installed himself at NITAAC, Courtney gained access to sensitive, nonpublic information about the procurements of other federal agencies being supported by NITAAC.   Courtney thereafter used that information to attempt to corrupt the procurement process by steering the award of contracts to companies where he was then also on the payroll, and used the false pretext of national security concerns to warp the process by preventing full and open competition.

Courtney’s sentencing has been scheduled for Oct. 23, 2020.

Source: https://www.justice.gov/opa/pr/former-dea-official-pleads-guilty-elaborate-4-million-fraud-scheme

Filed Under: Government Contracting News Tagged With: abuse, CIA, DEA, fraud, misrepresentation, NIH, NITAAC

June 5, 2020 By cs

Contractors to pay $2.8 million to settle False Claims Act allegations of fraudulently obtained small business contracts

Tulsa, Oklahoma-based contractor Ross Group Construction Corporation (Ross Group), and its corporate affiliates, have agreed to pay over $2.8 million to settle allegations that they violated the False Claims Act by improperly obtaining federal set-aside contracts reserved for disadvantaged small businesses, the Justice Department announced this week.   

To qualify as a small business for purposes of U.S. Small Business Administration (SBA) programs, companies must meet defined eligibility criteria, including requirements concerning size, ownership, and operational control.  The settlement with Ross Group resolves allegations that the company fraudulently induced the government to award certain small business set-aside contracts to several affiliated entities that did not meet eligibility requirements.

The government alleged that Ross Group created two companies, PentaCon LLC and C3 LLC, to obtain small business set-aside contracts for which Ross Group itself was ineligible.  Also alleged was that Ross Group maintained operational control over the day-to-day and long-term management decisions of the two purported small businesses, including controlling their financial affairs and business operations, and that, as a result, neither PentaCon nor C3 satisfied the size and eligibility requirements to participate in the set-aside programs.  Ross Group, PentaCon, and C3 allegedly concealed their affiliation from the government and knowingly misrepresented the eligibility of PentaCon and C3 for the set-aside contracts.

The settlement with Ross Group and its corporate affiliates resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery.  The civil lawsuit was filed in federal district court in the Western District of Oklahoma and is captioned United States ex rel. Southwind Construction Services, LLC v. The Ross Group Construction Corporation, et al., Case No. 15-0102-R (W.D. Okla.).  As part of the resolution of this matter, the whistleblower will receive approximately $520,000.

The settlement is the result of a coordinated effort among the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the Western District of Oklahoma, DCIS, the Inspector General Offices of the SBA, General Services Administration, and the Department of Veterans Affairs, and the Army Criminal Investigation Division Major Procurement Fraud Unit.

The claims resolved by the settlement are allegations only, and there has been no determination of liability.

Source: https://www.justice.gov/opa/pr/oklahoma-contractors-pay-28-million-settle-false-claims-act-allegations-concerning

Filed Under: Government Contracting News Tagged With: abuse, DOJ, false claims, False Claims Act, fraud, Justice Dept., misrepresentation, ownership and control, SBA, set-aside, small business, small disadvantaged business, whistleblower

March 4, 2020 By cs

IG says Pentagon awarded $876 million in contracts meant for disabled vets to ineligible companies

Small businesses owned or run by disabled veterans may have been cheated out of hundreds of millions of dollars in Defense Department contracts by unscrupulous firms who were ineligible for the awards.

This information is contained in an Inspector General’s report released to the public on Feb. 20, 2020.

The IG’s audit found that the DoD “awarded $876.8 million in contracts to ineligible contractors and did not implement procedures to ensure compliance with the Service-Disabled Veteran-Owned Small Business (SDVOSB) subcontracting requirements after the contracts were awarded.”

At least 16 of the 29 contractors reviewed in the report who received business from the DoD on the basis that they met the disabled veteran requirements were found to be ineligible, the IG’s office said.

Unless the DoD conducts better oversight, “service-disabled veterans may be in jeopardy of not receiving contract awards intended for them, and the DoD will be at risk of misreporting the amounts for SDVOSB participation,” the 29-page report states.

Keep reading this article at: https://www.military.com/daily-news/2020/02/20/pentagon-awarded-876m-contracts-meant-disabled-vets-ineligible-companies-ig.html

Filed Under: Government Contracting News Tagged With: abuse, DoD, fraud, IG, misrepresentation, SBA, SDVOSB, service disabled, sham, small business, veteran owned businesses

December 14, 2017 By AMK

Former contracting officer at nuclear R&D facility pleads guilty to wire fraud and money laundering

A former procurement officer employed at Sandia Corporation, the prime operator of a federally funded nuclear research and development facility, pleaded guilty Dec. 5th to charges of wire fraud and money laundering for orchestrating a scheme to obtain approximately $2.3 million in federal funds through fraudulent means and for laundering fraudulently obtained proceeds through her father’s companies.

Carla Sena, 55, of Santa Rosa, New Mexico, pleaded guilty to one count of wire fraud and one count of money laundering in the U.S. District Court of New Mexico.  Sentencing will be scheduled at a later date. 

According to the plea documents, Sena’s employer, Sandia Corporation, managed and operated Sandia National Laboratories (SNL), a nuclear research and development facility owned by the federal government under sponsorship of the U.S. Department of Energy (DOE).

  • In late 2010, Sena managed the bidding process for the award of a multi-million-dollar contract for moving services at SNL.
  • Sena admitted that, in anticipation of the bidding process for this contract, she created the company, New Mexico Express Movers LLC (Movers LLC), to which she awarded the multi-million-dollar contract.
  • Sena prepared a bid on Movers LLC’s behalf containing fraudulent misrepresentations, and submitted the bid under the name of an individual who had no knowledge of Movers LLC to conceal her involvement.
  • Sena also admitted that she used her position of trust to access inside information and competing bidders’ documents that she leveraged to ensure award of the contract to Movers LLC.
  • As a direct result of Sena’s fraudulent scheme, Movers LLC received approximately $2.3 million in federal funds between May 2011 and April 2016.
  • Sena also admitted that, between October 2011 and April 2015, she transferred via negotiated checks at least $643,000 of the fraudulently obtained proceeds to legitimate businesses owned by her father with the intent to conceal the source and control of those funds and her subsequent personal gain from the proceeds.

The DOE Office of Inspector General investigated the case.

Source: https://www.justice.gov/opa/pr/former-procurement-officer-federally-funded-nuclear-research-and-development-facility-pleads

Filed Under: Government Contracting News Tagged With: abuse, DOE, Energy Dept., fraud, IG, misrepresentation, money laundering, OIG, Sandia National Laboratories, wire fraud

  • 1
  • 2
  • Next Page »

Popular Topics

abuse acquisition reform acquisition strategy acquisition training acquisition workforce Air Force Army AT&L bid protest budget budget cuts competition cybersecurity DAU DFARS DHS DoD DOJ FAR fraud GAO Georgia Tech GSA GSA Schedule GSA Schedules IG industrial base information technology innovation IT Justice Dept. Navy NDAA OFPP OMB OTA Pentagon procurement reform protest SBA sequestration small business spending technology VA
Contracting Academy Logo
75 Fifth Street, NW, Suite 300
Atlanta, GA 30308
info@ContractingAcademy.gatech.edu
Phone: 404-894-6109
Fax: 404-410-6885

RSS Twitter

Search this Website

Copyright © 2023 · Georgia Tech - Enterprise Innovation Institute