Defense Contractor Fraud and the False Claims Act

Information Provided by a Whistleblower Lawyer

Defense contractor fraud is one of the biggest areas of False Claims Act litigation. Defense contractors misrepresent quality and falsify records to meet contract requirements. There are a number of schemes commonly used to cheat the government, and in many cases, multiple schemes run concurrently.

If you are aware of defense contractor actions that constitute fraud under the False Claims Act, learn about whistleblower protection from an experience whistleblower lawyer.  Contact a whistleblower lawyer at Mike Love & Associates LLC for a confidential consultation to learn what steps you can take with the qui tam provisions of the False Claims Act.

Product Misrepresentation

This is a common type of defense contractor fraud. Contractors use inferior quality products than what is called for in the contract. The reason for this is to lower costs and is fraudulent when done without informing the government about of the substitution.

Cross Charging

With cross charging, the contractor manipulates “fixed-price” versus “cost-plus” contract types. The contractor can receive more money when employees who are working on a fixed-price project record their hours of as part of a cost-plus contract. By cross charging, the contractor receives payment not only for fixed costs, but also for a percentage of its costs plus profit. 

Falsified Cost Allocation

Improper or false cost allocation reports are another way a defense contractor can bill the government for extra money.

Mixing cost reports on government and private contracts is how defense contractors accomplish this. The goal is to shift more costs to a government contract that is cost-plus and away from a private contract, where payment is associated with a lower, market price.

This cost shifting allows the contractor to quote a lower price to commercial customers and then absorb the loss by bilking the government contract.

Non-compliance with Contract Specifications

Defense department contracts require exact specifications on materials used as well as quality assurance.

If the project begins to run over budget, a contractor may omit required testing or falsify reports to demonstrate fulfilled specifications when in fact they are not.

Understanding the Basis for a False Claims Act Case

All of the above circumstances representing intentional effort to defraud the government, and are the basis for litigation under the False Claims Act.

The qui tam provision of the False Claims Act allows individuals with knowledge of defense contractor fraud to come forward with evidence to establish a case.  If you need to move forward under these circumstances, get information on whistleblower protection with a confidential consultation from a whistleblower lawyer.   Contact a whistleblower attorney at Mike Love & Associates LLC where you can discuss your case with confidentiality and no risk to your job security.