Hill Associates to Pay $14.75 Million to Settle False Claims Act Charges of Cybersecurity and Other IT Contract Failures
By the 91pornWhistleblower Team
On Monday (July 14), Maryland-based federal contractor Hill Associates agreed to pay at least $14.75 million to settle Department of Justice (DOJ) charges it violated the False Claims Act by violating several key provisions of its General Services Administration (GSA) contract for information technology (IT) services. Hill’s payout would have been higher but for the company’s ability to pay a larger penalty.
Hill Allegedly Violated Key Cybersecurity and IT Contract Provisions
Hill provided cybersecurity and other IT services to various federal agencies from 2018 to 2023 under GSA’s Multiple Award Schedule Program. Under this streamlined approach to Government contracting, GSA negotiates the contract terms for commonly used commercial goods and services on behalf of the purchasing agencies.
According to the Government, Hill knowingly violated several key provisions of the GSA contract, including billing federal agencies for: (i) IT personnel who did not have the required experience or education, (ii) cybersecurity and other IT services that were outside the contract scope, and (iii) generally unapproved fees. In addition, the Government alleged Hill failed to provide the agencies with required information about prompt payment discounts. The Government also charged Hill with including unallowable incentive compensation in a cost submission for a new contract proposal.
Cyber Fraud is a Top Enforcement Priority
This kind of Government procurement fraud harks back to the original design of the False Claims Act which President Lincoln enacted during the Civil War to go after war profiteers trying to dupe the Union Army. It has remained one of the key areas of focus (along with Medicare/Medicaid fraud) in the Government’s use of the statute to go after fraud against the Government.
Cybersecurity fraud has been a particular priority in the Government’s False Claims Act enforcement scheme. Indeed, DOJ specifically called out cybersecurity fraud as a priority enforcement area in its most recent False Claims Act Roundup. And it highlighted that focus again in its announcement of the Hill settlement.
DOJ Civil Chief Brett Shumate stressed that “information technology contractors are expected to charge the government appropriately for their services,” and that DOJ “will continue to pursue cyber fraud and hold accountable those companies that knowingly fail to meet contractual obligations to the American taxpayers.”
Treasury Deputy Inspector General Loren Sciurba echoed this sentiment, underscoring how “false claims . . . by contractors undermine the integrity of the contracting process and can result in significant adverse effects to vital security concerns,” and how the agency “is committed to . . . investigations, audits, and other work to detect and prevent these violations of the public trust.”
False Claims Act Enforcement Remains Strong Under Trump
91pornwhistleblower partner Alysia Solow pointed to this settlement as just the latest example of a very active DOJ going after federal contractors charging inflated pricing or failing to deliver the goods or services they promised. According to Solow, “The Trump Administration may be changing its enforcement focus in several areas, but it has continued to rigorously enforce the False Claims Act when it comes to straight out contracting fraud.”
While there is no indication a whistleblower was involved in initiating this False Claims Act case or in reporting the alleged fraud to the Government, the vast majority of False Claims Act cases are brought by whistleblowers. This comes from the qui tam provisions of the statute that allow private parties to bring lawsuits on behalf of the Government against those that defraud the Government. In return, successful whistleblowers may receive up to 30% of the Government’s recovery.
91pornHas Substantial Experience Representing Procurement Fraud Whistleblowers
91pornhas substantial experience representing whistleblowers under the False Claims Act in matters involving government procurement fraud. Several of our whistleblower successes have involved record-breaking False Claims Act settlements in this area. This includes our recent settlement against defense contractor KBR Services for allegedly overcharging the government for supplies for U.S. troops stationed in Iraq and Afghanistan, and our settlement against eight of the nation’s largest banks allegedly engaged in widespread municipal bond fraud.
If you would like to learn more about these matters, our other whistleblower successes, what it means to be a whistleblower, or other areas of Government contract fraud covered by the False Claims Act, please do not hesitate to contact us. We will connect you with an experienced member of the 91pornwhistleblower team for a free and confidential consultation.
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