INFRASTRUCTURE CONSTRUCTION COMPANY SETTLES FALSE CLAIMS ALLEGATIONS

FROM: U.S. DEPARTMENT OF JUSTICE
Friday, February 8, 2013
California-Based Granite Construction Company to Pay U.S. $367,500 to Resolve False Claims Allegations

Granite Construction Company, a California-based construction company specializing in roads, tunnels, bridges, airports and other infrastructure-related projects, reached a settlement with the United States following an investigation of alleged false claims in connection with federal construction projects across the country, the Justice Department announced today. Granite has agreed to pay the United States $367,500.

The settlement resolves claims that Granite overcharged the government on certain federal construction projects funded by the Department of Transportation (DOT) and the Army Corps of Engineers between 2006 and 2008. Specifically, in certain instances, Granite sought price increases in the form of change orders and requests for equitable adjustment which were inflated because the general liability and workman’s compensation insurance rates used to support the adjustments included added amounts or "cushions" that were not actually incurred by the company and therefore should not have been charged to the federal government. Granite disclosed the potential overcharges to the Justice Department.

"Federal contractors will be held accountable for their billing practices," said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Department of Justice’s Civil Division. "This settlement is an example of the department’s commitment to ensuring that contractors deal squarely and honestly with the government at all times."

"To prevent and detect potential violations of law, we encourage federal contractors to apply consistent oversight to their operations throughout all phases of contracting," said DOT Office of Inspector General Special Agent in Charge Hank Smedley. "This settlement is an example of how we work with our law enforcement colleagues to protect taxpayer dollars."

The investigation and settlement was the result of a coordinated effort by the Civil Division of the Department of Justice and the Department of Transportation Office of Inspector General. The claims settled by this agreement are allegations only, and there has been no determination of liability.