ReadyOne Industries Inc. has agreed to pay $5 million to resolve allegations that it violated the False Claims Act by knowingly submitting false certific ations regarding the annual percentages of dir ect labor hou rs per formed by people with sev ere disabilities, the Justice Department announced today. ReadyOne, previously known as the National Center for Employment of the Disabled (NCED), is headquartered in El Paso, Texas, and is a manufacturer of apparel, boxes and other products.
NCED was a participant in the AbilityOne® Program, which creates employment opportunities for people who are blind or have other significant disabilities in the manufacture and delivery of products and services to the federal government. The program uses the purchasing power of the federal government to buy approved products and services from participating, community-based nonprofit agencies nationwide. These community-based nonprofit agencies, like NCED, must ensure that 75 percent of all annual direct labor hours on certain government contracts are performed by employees who are blind or severely disabled. The program is managed by the Committee for Purchase From People Who Are Blind or Severely Disabled, which is a federal agency. The United States alleges that, between 2000 and 2006, NCED employed a large number of non-disabled employees to work on contracts for the manufacture of archival boxes, apparel and other items, and did not appropriately account for their hours as part of the overall ratios it certified and submitted to the committee.
“The AbilityOne program is an important source of employment for people who are blind or have other significant disabilities,” said Stuart Delery, Acting Assistant Attorney General for the Civil Division of the Department of Justice. “False certifications undermine that program and will not be tolerated.”
“This settlement is particularly important because it protects the integrity of a program that ensures disabled individuals are able to reach their maximum employment potential,” said U.S. Attorney Neil H. MacBride for the Eastern District of Virginia.
“AbilityOne Program integrity is paramount. We will continue to monitor and ensure that the people the AbilityOne Program was designed to employ are, in fact, the ones benefitting from this program. We appreciate the Department of Justice’s persistence and professionalism in resolving this matter,” said Tina Ballard, Executive Director and CEO, Committee for Purchase From People Who Are Blind or Severely Disabled.
The settlement arises from a qui tam, or whistleblower, lawsuit filed in the Eastern District of Virginia under the False Claims Act by Michael Ahumada, a former employee of NCED. Under the qui tam provisions of the False Claims Act a private citizens may file actions for false claims on behalf of the United States and share in any recovery.
The government’s investigation was conducted by the U.S. Attorney’s Office for the Eastern District of Virginia, the Civil Division of the U.S. Department of Justice, the General Services Administration and the Committee for Purchase from People Who Are Blind or Severely Disabled. The claims settled by this a gre ement are alle gations onl y, and the re has b een no det ermination of liabilit y.
The lawsuit is captioned as United States ex rel. Mike Ahumada v. National Center for Employment of the Disabled, et al., No. 1:06-cv-713 (E.D. Va.).