Go Fish
03-27-2008, 02:21 AM
WASHINGTON, March 26 /PRNewswire-USNewswire/ -- National Air Cargo
(NAC) has agreed to pay the United States $28 million to settle both
criminal and civil allegations that it defrauded the Department of Defense,
the Justice Department announced today.
As part of the global settlement, NAC pleaded guilty to one count of
knowingly making a material misstatement to the United States. NAC will pay
criminal restitution of $4.4 million, a criminal penalty of $8.8 million,
and forfeit assets in the amount of $3.05 million. NAC will also pay $11.75
million to resolve allegations that it violated the False Claims Act.
The global settlement resolves allegations that NAC submitted
fraudulent claims for payment to the Department of Defense for the shipment
of freight. The government alleged that, during the period from Jan. 1,
1999, through April 2005, NAC engaged in a pattern and practice of
knowingly submitting false claims for payment by transporting freight
wholly by surface transportation rather than by air as required by
Department of Defense regulations and by misrepresenting the actual
delivery dates of the freight.
"Today's settlement demonstrates the United States' determination to
ensure that contractors doing business with our military departments do not
divert resources needed for the war effort into their own pockets through
fraud," said acting Assistant Attorney General Jeffrey S. Bucholtz, head of
the Justice Department's Civil Division.
The civil settlement agreement resolves allegations against NAC that
were filed in a federal lawsuit brought by a "whistleblower," Mark Oehm,
under the False Claims Act. The act permits private citizens to bring
lawsuits on behalf of the United States and receive a portion of the
proceeds of any settlement or judgment awarded against a defendant. Mr.
Oehm, a former NAC employee, will receive $3.3 million as his share of the
proceeds of the False Claims Act settlement.
"This felony conviction, which includes the largest criminal and civil
penalties ever imposed in the Western District of New York, makes it clear
that dishonest corporate entities are not immune from bearing substantial
consequences arising from their deliberate efforts to cheat the American
public," said U.S. Attorney Terrance P. Flynn.
The global settlement is an example of the Justice Department's
commitment to protect U.S. taxpayers from procurement fraud through its
creation of the National Procurement Fraud Task Force. The National
Procurement Fraud Initiative announced in October 2006 is designed to
promote the early detection, investigation, and prosecution of procurement
fraud associated with the increase in contracting activity for national
security and other government programs.
The settlement with NAC was the result of a coordinated effort by the
U.S. Attorney's Office for the Western District of New York, with the
assistance of the Civil Division of the Department of Justice, the Defense
Criminal Investigative Service, Army CID, the Air Force Office of Special
Investigations, and the Federal Bureau of Investigation.
SOURCE U.S. Department of Justice
(NAC) has agreed to pay the United States $28 million to settle both
criminal and civil allegations that it defrauded the Department of Defense,
the Justice Department announced today.
As part of the global settlement, NAC pleaded guilty to one count of
knowingly making a material misstatement to the United States. NAC will pay
criminal restitution of $4.4 million, a criminal penalty of $8.8 million,
and forfeit assets in the amount of $3.05 million. NAC will also pay $11.75
million to resolve allegations that it violated the False Claims Act.
The global settlement resolves allegations that NAC submitted
fraudulent claims for payment to the Department of Defense for the shipment
of freight. The government alleged that, during the period from Jan. 1,
1999, through April 2005, NAC engaged in a pattern and practice of
knowingly submitting false claims for payment by transporting freight
wholly by surface transportation rather than by air as required by
Department of Defense regulations and by misrepresenting the actual
delivery dates of the freight.
"Today's settlement demonstrates the United States' determination to
ensure that contractors doing business with our military departments do not
divert resources needed for the war effort into their own pockets through
fraud," said acting Assistant Attorney General Jeffrey S. Bucholtz, head of
the Justice Department's Civil Division.
The civil settlement agreement resolves allegations against NAC that
were filed in a federal lawsuit brought by a "whistleblower," Mark Oehm,
under the False Claims Act. The act permits private citizens to bring
lawsuits on behalf of the United States and receive a portion of the
proceeds of any settlement or judgment awarded against a defendant. Mr.
Oehm, a former NAC employee, will receive $3.3 million as his share of the
proceeds of the False Claims Act settlement.
"This felony conviction, which includes the largest criminal and civil
penalties ever imposed in the Western District of New York, makes it clear
that dishonest corporate entities are not immune from bearing substantial
consequences arising from their deliberate efforts to cheat the American
public," said U.S. Attorney Terrance P. Flynn.
The global settlement is an example of the Justice Department's
commitment to protect U.S. taxpayers from procurement fraud through its
creation of the National Procurement Fraud Task Force. The National
Procurement Fraud Initiative announced in October 2006 is designed to
promote the early detection, investigation, and prosecution of procurement
fraud associated with the increase in contracting activity for national
security and other government programs.
The settlement with NAC was the result of a coordinated effort by the
U.S. Attorney's Office for the Western District of New York, with the
assistance of the Civil Division of the Department of Justice, the Defense
Criminal Investigative Service, Army CID, the Air Force Office of Special
Investigations, and the Federal Bureau of Investigation.
SOURCE U.S. Department of Justice