The United States District Court for the Eastern District of Pennsylvania in Philadelphia recently issued an opinion that should get the attention of any contractor or subcontractor performing work on a federal funded construction project. In U.S. ex rel IBEW Local 98 v. The Fairfield Company, the federal court held that a contractor on a
Last week, I posted about how whistleblowers continue to receive large settlements related to DBE fraud. A somewhat recent case from the federal court in Maryland shows how whistleblowers are ferreting out DBE fraud on construction projects receiving any form of federal funding.
The case involves a bridge painting project in Maryland that was let by the Maryland State Highway Administration. The contract required the prime contractor to meet a 15% DBE participation goal. The prime contractor submitted a bid stating it would have 15.12% DBE participation. After it was awarded the contract, the prime contractor – as is typical – submitted additional forms certifying to the MSHA that 15.12% of its contract price would be performed by a DBE firm. The prime contractor indicated that one DBE subcontractor, Northeast Work and Safety Boats, LLC (“NWSB”), would perform the 15.12% of the work.
It has been awhile since I last blogged about fraud involving the Department of Transportation’s disadvantaged business enterprise (DBE) program. Trust me, the problem has not gone away. If anything, prosecutions and civil claims filed under the False Claims Act alleging DBE fraud have become so frequent, I could not write a blog post about each one. The biggest winners in 2016 may have been the whistleblowers that brought the DBE fraud to the attention of the Department of Justice, who were awarded millions of dollars for doing their part to ferret out fraud. Recent whistleblower settlements include:
In early March, the United States Federal Court for the Southern District of Ohio unsealed a complaint filed by the Painters and Allied Trade’s Council No. 6 against a painting contractor under the False Claims Act. (A copy of the complaint can be viewed here: Complaint) The Complaint is brought against a non-union painting…
- False Claims Act suits hitting an all-time high of 753 in 2013, and
Not only is this case interesting for political reason, it also acts as a warning to contractors on federally funded construction projects.