Defense Contractor Agrees to Pay U.S. Government $16 Million to Settle False Claims Act Allegations

Defense Contractor Agrees to Pay U.S. Government $16 Million to Settle False Claims Act Allegations

Virginia based contractor ADS Inc. and its subsidiaries agreed to pay the United States government $16 million to settle allegations that they violated the federal False Claims Act by “knowingly conspiring with and causing purported small businesses to submit false claims for payment in connection with fraudulently obtained small business contracts.” This settlement is one of the largest recoveries for the government involving allegations of small business contracting eligibility fraud.

Companies must meet defined eligibility criteria to qualify for these small business contracts, including requirements regarding the size, ownership, and operational control of the business. This settlement resolves a number of allegations, including allegations that ADS engaged in improper bid rigging schemes related to certain fraudulently obtained contracts. Also, purported small businesses affiliated with ADS include Mythics Inc., London Bridge Trading Co. Ltd., and MJL Enterprises LLC, allegedly falsely claimed to be eligible service-disabled, veteran-owned companies. Lastly, SEK Solutions LLC and Karda Systems LLC, allegedly falsely claimed to qualify as socially or economically disadvantaged businesses under the Small Business Administration’s 8(a) Business Development Program.

The Department of Justice states: “The claims resolved by the settlement are allegations only, and there has been no determination of liability.” U.S. Attorney Channing D. Phillips said, “This settlement reflects the government’s commitment to ensure that its business partners are truthful in their dealings with the United States.”

Whistleblowers Will Receive $2.9 Million From This Settlement

The allegations against ADS were originally brought in lawsuit filed under the whistleblower provisions of the False Claims Act, in a Qui tam suit. A Qui tam is a civil lawsuit brought by private party “whistleblowers” on behalf of the United States.

The False Claims Act permits private parties to sue on behalf of the government for false claims for government funds and to receive a share of any recovery made by the government. It rewards whistleblowers if their Qui tam case is successful and recovers funds for the government. In this case the whistleblowers will receive approximately $2.9 million as their share of the $16 million recover in this case.

Our Law Firm Helps Protect Whistleblowers

If you are a whistleblower with evidence that your employer is engaging in criminal acts, we are prepared to rigorously protect your rights.

Whistleblowers can certainly benefit from the help of an experienced Qui tam attorney. When you hire Ashley D. Adams, PLC to handle your Qui tam case, we will guide you through the bureaucratic labyrinth of the federal False Claims Act. We will protect your rights as an employee. And we will help you get the financial reward to which you may be entitled if the information you provide leads to prosecution and the recovery of money for the government.

Contact us or call now (480) 219-1366 for a consultation. There is no substitute for the type of experience and diligent legal representation that a high-quality attorney can provide.

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