Virginia-based consulting firm Booz Allen Hamilton Holding has agreed to pay the U.S. government $377.4 million to resolve allegations that it violated the False Claims Act by improperly billing commercial and international costs to its government contracts for 10 years.
The U.S. Department of Justice said the settlement resolves allegations that from about 2011 to 2021, Booz Allen improperly charged costs to its government contracts and subcontracts that instead should have been billed to its commercial and international contracts.
Specifically, the government alleged that Booz Allen improperly allocated indirect costs associated with its commercial and international business to its government contracts and subcontracts that either had no relationship to those contracts and subcontracts or were allocated to those contracts and subcontracts in disproportionate amounts. The government also alleged the company failed to disclose to the government the methods by which it accounted for costs supporting its commercial and international businesses.
“As a result, Booz Allen obtained reimbursement from the government for the costs of commercial activities that provided no benefit to the United States,” according to a statement from the Justice Department.
“Government contractors must turn square corners when billing the government for costs under government contracts,” Principal Deputy Assistant Attorney General Brian Boynton, head of the Justice Department’s Civil Division, said in a statement. “Today’s settlement demonstrates our commitment to hold accountable contractors that knowingly overcharge the government and enrich themselves at the expense of the American taxpayers.”
Booz Allen denied wrongdoing.
“Booz Allen has always believed it acted lawfully and responsibly,” the company said in a statement. “It decided to settle this civil inquiry for pragmatic business reasons to avoid the delay, uncertainty, and expense of protracted litigation. The company did not want to engage in what likely would have been a years-long court fight with its largest client, the U.S. government, on an immensely complex matter. This settlement ends the DOJ’s civil investigation more than six years after it began. DOJ closed its parallel criminal investigation more than two years ago, taking no action.”
