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PRIDE Industries agrees to pay $400,000 in false claims suit
09-07-2011
Tagged Under : Pay, Pride Industries
Roseville-based PRIDE Industries, one of the nation’s largest employers of disabled people, as well as a subsidiary, PRIDE Industries One, have agreed to pay the federal government $400,000 to resolve allegations that it knowingly submitted false claims relating to a maintenance contract at the Fort Bliss Army Base in El Paso, Texas, the U.S. Justice Department announced Monday.
The contract is part of the AbilityOne program, which procures contracts for goods and services that provide employment to disabled people.
Under the program, managed by the Committee for Purchase From People Who Are Blind or Severely Disabled, a federal agency, contractors must ensure that 75 percent of all direct labor hours are performed by severely disabled employees.
Between 2007 and 2010, according to the Justice Department, PRIDE employed a large number of temporary, non-disabled workers as part of its maintenance staff, but did not count their hours as part of its overall ratio. Thus, PRIDE reported false ratio numbers to both NISH, the nonprofit designated by the committee to help oversee AbilityOne, and to the committee itself.
In addition, the department said, PRIDE overcharged the Army by adding costs not allowed under the contract and by charging too much for labor.
PRIDE spokeswoman Audrey Farrington said the company cooperated with the government’s investigation and the settlement “involves no admission of liability by PRIDE.”
She added that “PRIDE has voluntarily enhanced certain internal controls and compliance procedures.”
The government’s investigation was triggered by a lawsuit filed by two whistle-blowers under the False Claims Act, which permits private parties to sue on behalf of the United States and share in any recovery. The whistle-blowers in this case will receive $68,000 of the settlement money.
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