WASHINGTON – CFP Group, located in McLean, Va., and its president, Roberto Clark, have agreed to pay the United States $150,000 to settle claims that they used false statements to obtain a contract from the Department of Veterans Affairs, the Justice Department announced today. The United States alleged that CFP Group and Clark made false statements to the Small Business Administration (SBA) to obtain certification as a Historically Underutilized Business Zone (HUBZone) company, and then used this certification to wrongfully obtain a Veterans Affairs contract for fire alarm installation.
Under the HUBZone program, companies that maintain their principal office in a designated HUBZone, and meet certain other requirements, can apply to the SBA for certification as a HUBZone small business company. HUBZone companies can then use this certification when bidding on government contracts. In certain cases, government agencies will restrict competition for a contract to HUBZone-certified companies.
The United States alleged that Roberto Clark submitted an application on behalf of CFP Group to the SBA to have it certified as a HUBZone company. On the application, Clark represented that CFP Group’s principal office was located in a designated HUBZone in Maryland. In fact, the United States alleged, no company employees worked at that location and Clark’s office was actually in Vienna, Va., which is not a designated HUBZone location. Based on the false application, the SBA certified CFP Group as a HUBZone small business company. CFP Group then used this certification to obtain a fire alarms systems contract from the Department of Veterans Affairs, which had been set aside for a qualified HUBZone company. The company is no longer participating in the HUBZone program and has relocated to McLean, Va.
"The HUBZone program is intended to benefit companies that create jobs in areas of high unemployment," said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. "Participants in this program must act honestly and deal fairly and we will take action against those who don’t play by the rules."
"This case is one of a series that the Government has pursued for false claims made to obtain HUBZone and other set-aside contracts. The SBA Office of Inspector General will continue to aggressively pursue and seek criminal or civil fraud prosecution of false statements made to obtain preferential contracting and other government benefits," said SBA Inspector General Peggy E. Gustafson.
"This case represents the cooperative effort of SBA’s Offices of the General Counsel and the Inspector General and the Department of Justice to uncover and remedy fraud in our procurement programs. Uncovering and pursuing fraud cases is one of SBA’s highest priorities," said SBA General Counsel Sara Lipscomb.
Assistant Attorney General West thanked the Justice Department’s Civil Division, the SBA Office of General Counsel, the SBA Office of Inspector General, and the Department of Veterans Affairs Office of Inspector General for the collaboration that resulted in the settlement announced today.