The Times of San Diego reported:
A San Diego-based construction company has paid $5.4 million to resolve allegations that it fraudulently billed the federal government for work on multiple projects on military bases, including Camp Pendleton, the U.S. Attorney’s Office announced Wednesday.
It was alleged that Harper Construction Company Inc. knowingly used sham, small disadvantaged businesses and then falsely certified to the government that it used legitimate small disadvantaged businesses.
Harper Construction, a privately held general contractor, earns a substantial portion of its revenue through government contracting on construction projects across the country, prosecutors said.
The settlement involves four government contracts to construct facilities at Camp Pendleton and Camp Lejeune, North Carolina. The contracts required Harper to subcontract a certain percentage of work to small disadvantaged businesses.
Such requirements arise from measures intended to ensure that a fair proportion of federal contract and subcontract dollars are awarded to such businesses.
It was alleged that Harper subcontracted with sham businesses to pass through all of their work to an affiliated large business, Frazier Masonry Corp.
The settlement resolves a False Claims Act lawsuit filed by Rickey Howard, a former Frazier employee.
The whistleblower provisions of the False Claims Act permit the whistleblower to recover a portion of the proceeds obtained by the government.
As part of Wednesday’s resolution, Howard will receive $1,485,000.