ICYMI: Two Texas Tech Giants Hit with Over $4 Million Settlement for Overcharging U.S. Army
Two Austin, Texas tech companies have agreed to pay over $4 million after being accused of overcharging the U.S. Army for computer hardware. š #News #AustinTX #Texas #Crime
AUSTIN, TX – The U.S. Department of Justice has announced that two Austin, Texas technology companies will pay a combined total of more than $4 million to settle claims of overcharging the U.S. Army for computer hardware. Dell Technologies and Iron Bow Technologies were accused of colluding to inflate prices for military contracts, violating the False Claims Act.
Details of the Settlement
Dell Technologies Inc. and its subsidiary, Dell Federal Systems L.P., have agreed to pay $2.3 million to resolve allegations they overcharged the Army under the Army Desktop and Mobile Computing 3 (ADMC-3) contract. Iron Bow Technologies LLC will pay $2.05 million for its part in the scheme. The Justice Department’s settlement addresses claims that these companies engaged in fraudulent conduct, leading to higher prices on computer products purchased by the Army.
The case focused on a period between May 2020 and April 2024, when Dell provided preferential pricing to Iron Bow, allowing them to resell Dellās computer hardware to the Army at a higher cost. Dell also submitted higher bids for the same contracts, creating a false sense of competition, which led to the Army paying inflated prices.
The Allegations
The lawsuit accused Dell of using its relationship with Iron Bow to inflate prices for certain computer hardware. According to the U.S. government, Dell provided advantageous pricing to Iron Bow, who then resold the products to the Army at marked-up prices. Furthermore, Dell allegedly submitted its own higher bids for the same contracts, knowing that these bids would exceed Iron Bow’s pricing, thus skewing the competition.
These actions violated the False Claims Act, which prohibits companies from submitting fraudulent claims for government contracts. The Justice Department emphasized that such practices disrupt the fair bidding process and cost taxpayers significant amounts of money.
Whistleblower Involvement and Reward
A key part of the case was the role of Brent Lillard, a whistleblower and executive of another IT reseller, who brought the fraudulent scheme to light. Under the whistleblower provisions of the False Claims Act, Lillard will receive $345,000 from Dell’s settlement as part of the recovery.
“The United States relies on competition to get the best value and price for the American taxpayers,” said Principal Deputy Assistant Attorney General Brian M. Boynton. “This settlement demonstrates the departmentās commitment to hold accountable those who overcharge the government through collusion or other unlawful conduct.”
The settlement underscores the government’s continued commitment to investigating and prosecuting fraud in the contracting process, ensuring taxpayers are not unfairly burdened by inflated prices. The Justice Department and U.S. Attorney’s office have made it clear they will keep pursuing those who exploit government contracts for personal gain.
RELATED TOPICS: Crime | Texas | Washington, D.C.
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