Spotlight on Government Contract Fraud: The Violation of Small Business Set-Aside Provisions

As a small law firm, we are particularly aware of the many contributions that small businesses and small business owners make to our economy.  In our case, we believe being a small firm allows us to have a more personal touch and collaborate more closely with every client while providing top-notch legal services.  There are also unique challenges to running a small business.  One way that the government recognizes these important contributions and special challenges is by requiring that a certain percentage of federal contracts be awarded to small businesses.  Sadly, some companies attempt to lie to the government and the American people by holding themselves out as small businesses when they truly do not qualify as such.  This a form of fraud.  Our government contract fraud lawyer is dedicated to partnering with honest individuals to protect the integrity of small business set-aside programs and ferret out other forms of fraud on the federal government.

Construction Company Pays $5.4 Million to Settle Government Contract Fraud Allegations

Earlier this month, the Times of San Diego reported that a California-based construction company paid $5.4 million to settle allegations of fraudulent billing for work performed at Camp Pendleton and other military bases.  Harper Construction is a privately held company that earns a substantial share of its revenue through government contracts.  As indcontract2icated in the report, Harper had contracts to construct facilities at the military bases and these contracts specifically required that Harper subcontract a specified portion of the work to small disadvantaged businesses.  These requirements stem from government programs intended to ensure that such businesses receive a fair share of federal contract dollars.  According to the article, Harper stood accused of knowingly using sham companies and falsely certifying that it complied with the small business subcontracting requirements.  Instead of having legitimate small businesses perform the work, the lawsuit alleged that Harper actually passed the work to a large affiliate.

The article does not state whether Harper admitted to the wrongdoing and thus these claims should be considered allegations only.  The lawsuit was filed under the False Claims Act’s private whistleblower provisions by a former employee of the affiliate company who will receive $1,485,00 as a reward for his efforts on behalf of the government.

Small Businesses, Government Spending, and the American Dream

Although focused solely on the state of Colorado, a statement in a recent Colorado Springs Business Journal article helps capture the importance of small business set-asides in the defense contracting arena: “Small businesses contribute 65 percent of new jobs in the U.S., and defense activity produces $27 billion for the [Colorado] state economy — small business contracts with local military bases mean big money and bigger impact.”  When companies lie to obtain government contracts and commit fraud by violating these agreements, small business lose.  When small businesses lose, the American dream suffers.

Honest Whistleblowers and a Law Firm Dedicated to Fighting Fraud

Given the size of the government enterprise, the federal government cannot effectively police all government contract violations alone.  The government relies on honest private individuals to speak up when they witness government contract fraud and the False Claims Act provides a way for these honest individuals to bring suit on the government’s behalf.  We believe these individuals are true American heroes and we are proud to be a trusted partner in these pursuits.  Please call our government fraud whistleblowers’ law firm to learn more about our services and how one honest individual can make a big difference.

See Related Blog Posts:

Government Contract Fraud: Using the False Claims Act to Fight Back Against Companies that Cheat the American People

Using the False Claims Act and State Equivalents to Protect Privacy and American Jobs

(Image by Dan Moyle)