The Seyfarth Government Contracts Group shared six essential questions and answers that every government contractor and recipient should be prepared to address regarding procurement fraud.
Potential violations of the False Claims Act (FCA) should have your attention as they may entail triple damages for each invoice involved as well as possible suspension, debarment or an administrative oversight agreement. A falsified hotel receipt may be disallowed and reimbursed, but salary payments over multiple years that are based on falsified salary information may be a significant hit at triple damage for each invoice.
Violations of the FCA can take many forms in cost reimbursement type awards as ultimately all costs are billed.
- Falsified travel expenses are common in development and humanitarian work
- Falsified time sheets, especially for those working remotely or with limited supervision
- Inflated salary information and qualifications
- Payment for equipment or construction that do not meet subcontract specifications or delivery terms
- Payment for performance that was not according to the terms of the subaward, such as fewer participants, fewer trainings or field visits
- Not handling foreign currency transactions in accordance with corporate accounting standards
- Not allocating costs (e.g. between direct or indirect accounts or corporate costs vs project direct costs) in accordance with corporate accounting standards
Read more at Six Essential Q&As for Government Contractors on Procurement Fraud and Compliance Risks
