Wednesday, August 19, 2015

Contractor Employee Indicted in $1.9 Million Kickback Scheme

The Department of Justice released a press release earlier this month noting the Federal Grand Jury indictment of a contractor employee accused of accepting kickbacks (and tax evasion). The company he worked for (identified as Company A) furnished supplies, materials, equipment, and services to the Government. He approached a subcontractor to Company A and solicited kickbacks in exchange for:

  1. Refrain from conduct that would unfavorably affect the subcontractor's business relationship with Company A, and
  2. Help ensure that the subcontractor obtained additional subcontracting business.

Between June 2009 and December 2014, the employee accepted 57 kickbacks totaling $1.9 million. That might not have been the extent of the kickbacks - it only represents the amount that the Government investigators found.

In January and February of this year, the employee met with the subcontractor and accepted two more kickbacks totaling $30,000. However, by this time, the Government was on to the scheme and the transaction was "documented".

The contractor employee, whose title is Logistics Manager, maintains his innocence.
I've never done anything illegal in my life. I have a clear record, education wise, work wise, I give 100 percent to everything I do. I wouldn't do something stupid to jeopardize my family.
This is a reminder to contractors that according to the Anti-Kickback Act of 1986, there is a requirement to have in-place, policies and procedures to detect and prevent kickbacks. Read more about the Anti-Kickback Act here.

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