Transportation company agrees to settle allegations of impersonating military members to obtain Department of War moving business

FAIRVIEW HEIGHTS, Ill. – Denali Group, Inc. (“Denali”) has agreed to pay $3.5 million to resolve allegations that it violated the False Claims Act by submitting false customer satisfaction surveys while posing as U.S. Department of War and Coast Guard personnel.

“Denali’s fake surveys gave them an unfair advantage over other contractors and shortchanged our military families moving through Scott Air Force Base,” said U.S. Attorney Steven D. Weinhoeft. “Companies doing business with the federal government are expected to act with honesty and integrity, and we will use all our criminal and civil tools to protect taxpayer dollars from waste, fraud, and abuse.”

Denali, an Alaskan-based transportation company, participated in the Defense Personal Property Program (DP3) as a transportation service provider. DP3 provides moving and storage services to Department of War (DoW), formerly the Department of Defense (DoD), and Coast Guard personnel, including coordinating the movement of service members’ personal property when they relocate. DP3 is administered by the United States Transportation Command at Scott Air Force Base, Illinois.

During the relevant period, transportation service providers competed for DP3 shipments, and the number of shipments awarded by the Government to each company depended heavily upon scores in customer satisfaction surveys. These surveys were to be completed by DoW and Coast Guard personnel, or members of their households, after their personal property items were shipped through DP3.

"This outcome demonstrates the steadfast collaboration and determination by the Department of Defense Office of Inspector General, Defense Criminal Investigative Service (DCIS) and our investigative partners to ensure the integrity of the contracting process associated with the Defense Personal Property Program," said Acting Special Agent in Charge Chad Gosch, DCIS Southwest Field Office. "We remain committed to safeguarding those programs that contribute to elite military readiness, as well as the wellbeing of our warfighters and their families."

The United States alleges that, between January 2015 and March 2019, Denali employees submitted false customer satisfaction surveys to the Government with perfect scores for Denali. Evidence collected in the investigation showed that Denali employees called the customer survey line using call spoofing applications to mask their phone numbers and impersonated DoW or Coast Guard personnel during the surveys by disguising their voices, speaking with accents, or using voice changing technology through the spoofing applications.

“This settlement highlights the strong collaboration between Army CID and our law enforcement partners in protecting U.S. Army Soldiers and assets,” said Special Agent in Charge John McCabe, Department of the Army Criminal Investigation Division, Midcentral Field Office. “This outcome underscores our unwavering commitment to identifying those who defraud the U.S. Government.”

“Defrauding the Government through falsified surveys is an affront to America and Air Force families, directly undermining the very communities they inhabit,” said Special Agent William A. Rouse, Special Agent in Charge, Department of the Air Force (DAF), Office of Special Investigations (OSI), Procurement Fraud (PF) Detachment 4, Wright-Patterson AFB, OH. “Justice has been served, and we extend our gratitude to the investigative team for their diligence.”

According to allegations, Denali submitted false surveys with perfect scores, even when service members were unsatisfied with the moving services. The United States claims that by submitting false customer satisfaction surveys to the Government and inflating its performance scores, Denali fraudulently induced the Government into awarding Denali more DP3 shipments than it otherwise would have received. USTRANSCOM administratively removed Denali from DP3 in 2022.

"Integrity is essential to the contracting process, and collaboration among investigative agencies plays a critical role in upholding it," said Jennifer Desautel, Director of the Defense Contract Audit Agency. "When contractors falsify records, it not only undermines Americans' trust in their government but also highlights the need for accountability. DCAA auditors are proud to work alongside investigative partners to provide assurance throughout the contracting process."

The investigation was conducted by the DoD Office of Inspector General, Army Criminal Investigation Division, Air Force Office of Special Investigations, Defense Contract Audit Agency, Naval Criminal Investigative Service, and the Coast Guard Investigative Service. The United States was represented in this matter by Assistant United States Attorney Laura Barke.

To report fraud, waste, and abuse within the DoW, visit www.dodig.mil/hotline or call 1-800-424-9098.

The claims resolved by the settlement are allegations only and there has been no determination of liability.