Booz Allen agrees to pay $15.9M fine in DOD fraudulent invoice case

Booz Allen has agreed to pay a $15.9 million fine for violations of the False Claims Act in a case in which the company’s engineering division submitted fraudulent invoices to the Department of Defense for computer military training simulators and systems.

Booz Allen is headquartered in Northern Virginia. Its engineering division, Booz Allen Hamilton Engineering Services, is based in Annapolis Junction, Md., with offices in Dayton, Ohio, and other locations.

The settlement announced on Friday resolves allegations that Booz Allen Hamilton Engineering Services, also known as BES, through its former program managers John G. Hancock and Karen K. Paulsen, knowingly engaged in a fraudulent course of conduct with Keith A. Seguin, then a civilian Air Force employee and contracting official, and David J. Bolduc Jr., the co-owner and manager of a BES subcontractor, QuantaDyn Corporation, that resulted in the General Services Administration awarding BES a task order for training simulators that BES, in turn, awarded to QuantaDyn.

The government alleges that Seguin improperly and illegally divulged confidential government contracting and budget information, a competitor’s confidential bid or proposal information and source selection information to Hancock and Paulsen, who used the illicit information despite knowing they were not authorized to possess it.

Through this conduct, Hancock and Paulsen successfully influenced GSA to award the task order to BES.

Additionally, the government alleges that, after the GSA award, Hancock, Paulsen, Seguin and Bolduc made use of confidential government budget information to formulate and submit price quotes to GSA for the individual modules that BES awarded to QuantaDyn on a sole-source basis.

As a result, BES, through Hancock and Paulsen, knowingly submitted fraudulent claims to GSA under the 37 modules awarded to QuantaDyn, which GSA paid.

Hancock, Paulsen, Seguin and Bolduc previously resolved criminal charges related to this conduct.

“Government contractors that improperly receive confidential government information during the procurement process corrupt the integrity of that process,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “This settlement demonstrates our continuing commitment to protecting the integrity of the government’s procurement process.”