COMPANY TO PAY MORE THAN $5.6 MILLION TO RESOLVE FALSE CLAIMS ALLEGATIONS

FROM: U.S. DEPARTMENT OF JUSTICE
Friday, March 29, 2013
CDW-Government to Pay U.S. $5,663,902 to Resolve False Claims Act Allegations

CDW-Government LLC (CDW-G) has agreed to pay $5.66 million to resolve allegations that it submitted false claims in connection with a U.S. General Services Administration (GSA) contract, the Justice Department announced today. CDW-G is a wholly-owned subsidiary of Illinois-based CDW Corporation and a reseller of information technology, equipment, services, office supplies and related products. The settlement resolves allegations that, during the period 1999 to 2011, CDW-G improperly charged government purchasers for shipping, sold products to the United States that were manufactured in China and other countries that are prohibited by the Trade Agreements Act, and underreported sales in order to avoid paying GSA its "Industrial Funding Fee," a fee based on total contract sales that is designed to cover GSA’s costs of contract administration.

"Protecting the federal procurement process is a top priority for the Department of Justice," said Stuart F. Delery, Acting Assistant Attorney General for the Department of Justice’s Civil Division. "Contractors who abuse that process and undermine American trade interests will be held accountable for their actions."

"My office will not tolerate any abuse of the contracting process with the United States," said Stephen R. Wigginton, U.S. Attorney for the Southern District of Illinois. "My warning is both simple and certain: If you knowingly overcharge the United States, we will pursue all remedies available to us and we will recover the government’s losses."

The allegations arose from a lawsuit filed in a federal court in East Saint Louis, Ill., under the qui tam or whistleblower provisions of the False Claims Act. Those provisions allow private individuals known as "relators" to sue on behalf of the United States and to share in the proceeds of any settlement or judgment that may result. The relator in this case, former CDW-G sales representative Joe Liotine, will receive $1,336,098 of the total recovery as a statutory award. The relator may also be entitled to receive additional amounts from the defendant for attorneys’ fees and costs.

The claims settled by this agreement are allegations only, and there has been no determination of liability. The case is captioned U.S. ex rel. Joe Liotine, vs. CDW-Government, Inc., 05-cv-33-DRH-DGW. The settlement was the result of a coordinated effort by the Civil Division of the Department of Justice, the U.S. Attorney’s Office for the Southern District of Illinois and the GSA Office of Inspector General.

TELECOMMUNICATIONS FIRM PAYS $1 MILLION TO SETTLE TRADE AGREEMENTS ACT CASE

FROM: U.S. DEPARTMENT OF JUSTICE
Monday, July 9, 2012
Telecommunications Firm to Pay Us $1 Million to Settle Alleged Violations of the Trade Agreements Act.

ADC Telecommunications Inc. will pay the United States $1 million to resolve allegations that the company submitted false claims to federal agencies when it sold telecommunications goods manufactured in countries prohibited by the Trade Agreements Act (TAA).  

From October 2005 through December 2008, ADC manufactured and sold telecommunications hardware, such as communication modems, extender modules and shelf adapters to various federal agencies through its General Services Administration (GSA) Multiple Award Schedule contract.   This settlement resolves allegations disclosed by the company that it knowingly manufactured and sold products from countries such as China that do not have reciprocal trade agreements with the United States and are not on the list of designated countries.   The client government agencies included a number of federal agencies, including the Departments of Defense, Homeland Security and Interior.
Compliance with the TAA is required by GSA Multiple Award Schedule

contracts.   Goods purchased under these contracts must be manufactured in one of a list of designated countries deemed to trade fairly with the United States.

“Protecting the federal procurement process is central to the mission of the Department of Justice,” said Stuart Delery, Acting Assistant Attorney General for the Department of Justice’s Civil Division.   “It is incumbent upon contractors that supply products to federal agencies to abide by the legal requirements designed to protect U.S. trade interests.”

“This settlement demonstrates this office’s commitment to ensure that products sold to the government are made in countries that respect and adhere to our nation’s trade policies,” said Ronald C. Machen Jr., the U.S. Attorney for the District of Columbia.   “We expect all companies who do business with the United States to understand and comply with the laws that govern their transactions.”

GSA Inspector General Brian Miller stated “We appreciate ADC's cooperation in the OIG’s investigation of this matter.”

This matter was jointly handled by the GSA Office of the Inspector General, the Justice Department’s Civil Division and the U.S. Attorney’s Office for the District of Columbia.