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Government Contractors Agree to Settle False Claims Act Case for $3 Million

Three government contractors, American Systems Corporation (“ASC”); Anixter International, Inc. (“Anixter”); and Corning Cable Systems LC (“Corning”), have agreed to settle charges that they violated the False Claims Act and Anti-Kickback Statute.

According to the government, in 2009, ASC and Anixter teamed together to bid on a contract with the CIA to provide supplies and services, with Corning as a supplier. The government alleged that ASC, Anixter and Corning provided various gratuities, such as entertainment and meals, to CIA employees in violation of the Anti-Kickback Statute. The government claimed the illegal gifts influenced CIA employees and consultants into making contract specifications favorable to the companies, to increase the likelihood that the trio would be awarded the contract.

ASC, Anixter and Corning have agreed to pay the federal government $3 million to settle the allegations.

The allegations first came to light when a former Anixter employee, William Jones, filed a whistleblower lawsuit under the qui tam provisions of the False Claims Act. As his reward under the qui tam provisions of the False Claims Act, Jones will receive $585,000 of the settlement amount.