The Commonwealth of Virginia is one of the largest recipients of federal government contracts in the country. In fact, a five-year study by the Northern Virginia Regional Commission found that Northern Virginia by itself would outrank every state except California in the amount of non-payroll, defense and nondefense contracts being awarded. At its peak, in 2011, federal government procurement in Northern Virginia topped $60 billion. With that much spending, how much fraud is there likely to be?
Rep. Darrell Issa, former chairman of the House Oversight Committee, estimated the federal government lost $261 billion, or seven percent of its total spending, to fraud and waste in 2012. If that percentage held true for Northern Virginia, contractors in the region would have defrauded the government of about $4 billion. Given that qui tam plaintiffs can earn 15 to 25 percent of the government’s recovery in a False Claims Act case, if qui tam actions recovered all of the government’s losses, plaintiffs would share in $600 million to $1 billion.
The U.S. Department of Defense is one of the worst offenders when it comes to wasting the money Congress allocates. Although much of the DoD’s losses are due to poor management, there are plenty of cases of outright fraud by defense contractors. The Department of Justice announced the closure of one such case in December 2014 in which two foreign companies had defrauded the DoD on contracts to provide supplies of food and water for U.S. troops in Afghanistan. The two companies agreed to pay $434 million in criminal penalties to settle a False Claims Act case. They agreed to pay an additional $146 million to resolve related civil lawsuits.
Virginia’s status as the home of the Pentagon and its reputation as a favorable state for businesses have made it the hub of defense contracting in the United States If you work for a defense contractor in Virginia and are aware of fraud against the government, you should seek the advice of an experienced Virginia whistleblower attorney.
The extremely competitive aerospace industry depends on lucrative government contracts for aircrafts and airports. The aerospace industry is also highly regulated, a condition that often breeds corruption. Public corruption certainly qualifies as a conspiracy to defraud the government under the federal False Claims Act. Information about such corruption could form the basis for a qui tam lawsuit.
If you have information about fraud in a defense or aerospace contract and are considering coming forward, our attorneys are prepared to help. Jeremiah A. Denton III, P.C. provides reliable guidance and skilled trial advocacy in federal qui tam cases. To schedule an appointment with a trustworthy attorney, call 757-215-4818 or contact our Virginia Beach office online.
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