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Justice News

Department of Justice
U.S. Attorney’s Office
Northern District of New York

FOR IMMEDIATE RELEASE
Thursday, July 25, 2019

Federal Contractor Pays $435,000 to Resolve False Claims Act Exposure

SYRACUSE, NEW YORK – Silvus Technologies, Inc., a California based company specializing in wireless communication systems, agreed today to pay $435,806 to resolve a False Claims Act investigation into the company’s cost-based billing on government contracts. 

According to the settlement agreement, the government overpaid Silvus on three different Air Force contracts.  The overpayments were due to Silvus’s failure to track accurately its direct labor costs and certain indirect costs (including tax payments).  Silvus improperly attributed some employee labor costs to the contracts and included certain unallowable charges in its incurred cost proposals.

“This settlement reflects the Northern District of New York’s continued commitment to using civil enforcement tools to recover money wrongfully paid by the government,” said United States Attorney Grant C. Jaquith.  “It is critical that government contractors have internal controls in place to ensure that cost-based billings are fair and accurate.”

“The announced settlement sends a clear message that those who inappropriately profit by willfully disregarding established Department of Defense procurement protocols will be investigated and held accountable,” said Bryan D. Denny, Special Agent in Charge of the Western Field Office, Defense Criminal Investigative Service.  “Those who contract with the Department of Defense must be above reproach.  The Defense Criminal Investigative Service will continue to investigate anyone who seeks to compromise the procurement system at the expense of the U.S. military and taxpayers.”

This case was investigated by the Air Force Office of Special Investigations, the Defense Criminal Investigative Service, and the Army Criminal Investigation Command.  Additional investigative assistance was provided by the Defense Contract Audit Agency and the Air Force Materiel Command Law Office Fraud Division.  The United States was represented by Assistant U.S. Attorney Michael D. Gadarian.

Topic(s): 
False Claims Act
Updated July 25, 2019