MOX Services Agrees to Pay $10 Million to Resolve Allegations of Knowingly Presenting False Claims to Department of Energy for Non-Existent Construction Materials
MOX Services LLC, formerly known as CB&I AREVA MOX Services LLC (MOX), located in South Carolina, has agreed to pay $10 million to resolve allegations that it violated the False Claims Act by knowingly submitting to the U.S. Department of Energy (DOE) false and fraudulent invoices for non-existent materials and receiving improper kickbacks.
MOX was the prime contractor for the construction of the Mixed Oxide Fuel Fabrication Facility at the DOE Savannah River Site in Aiken, South Carolina. The United States alleged that MOX was obligated to confirm receipt and acceptance from subcontractors of any materials before MOX approved and submitted claims to DOE for those materials. One of those subcontractors — Wise Services Inc. (Wise) — submitted to MOX hundreds of invoices charging millions of dollars for materials that did not exist. MOX presented those false invoices to DOE. The United States alleged that by knowingly failing to follow its own policies and procedures, MOX violated its obligation to uncover that the Wise invoices were for non-existent materials. The United States also alleged that MOX employees received kickbacks from Wise employees involved in the scheme.
“It is vital that contractors on federally funded projects provide sufficient oversight of the companies they hire to ensure that the government is billed only for legitimate goods and services,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department will pursue those who knowingly fail to prevent the submission of false claims.”
“Federal contractors cannot charge for non-existent materials and accept kickbacks in connection with federal contracts,” said U.S. Attorney Corey F. Ellis for the District of South Carolina. “To do so is to defraud the American taxpayer. The District of South Carolina will use all available remedies to hold those contractors accountable.”
“Contractors to the Department of Energy cannot turn a blind eye to the fraudulent behavior of their subcontractors,” said Inspector General Teri L. Donaldson Department of Energy. “These behaviors undermine the Department of Energy’s programs and operations. The Inspector General’s office will continue to work with our partners at the Justice Department and the U.S. Attorney’s Offices to hold those who defraud the government accountable.”
The civil settlement includes the resolution of claims against MOX brought under the False Claims Act by the United States in the case captioned United States v. CB&I AREVA MOX Services LLC and Wise Services Inc., No. 19-cv-444 (D.S.C.).
The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section and the U.S. Attorney’s Office for the District of South Carolina, with assistance from the DOE Office of Inspector General and the National Nuclear Security Administration.
The matter was handled by Fraud Section Attorneys Don Williamson and Rory Skaggs and Civil Division Chief James Leventis and Assistant U.S. Attorneys Johanna Valenzuela and Sheria Clarke with the U.S. Attorney’s Office for the District of South Carolina.
The claims resolved by the settlement are allegations only and there has been no determination of liability.