Major contractor Parsons agrees to $3.8M settlement amid False Claims Act allegations

Dive Brief:

The Department of Justice reported Wednesday that the government services unit of contracting giant Parsons Corporation agreed to pay $3.8 million to the federal government in a settlement over charges that the company deliberately mischarged the Department of Energy.
Parsons — the main construction contractor on the department's Aiken, SC, Salt Waste Processing Facility project — allegedly claimed and accepted reimbursement for relocation expenses for workers who weren't in fact eligible for those payments, according to the DOJ.
Although Parsons agreed to pay the settlement amount, the company denies any wrongdoing. Parsons said in a statement that it decided to settle the matter "because the corporation has determined that the costs of continuing the dispute would far exceed the amount in dispute and would continue to divert valuable resources from its core mission of supporting its customers."

Dive Insight:

The federal government charged Parsons under the False Claims Act, which allows the government to seek as much as three times the damages incurred from the wrongdoing. In this case, the two sides settled at double the damages, which was reportedly between $1.6 million and $1.9 million and occurred between 2002 and 2011, according to the DOJ.

The government said Parsons had the duty to ensure its employees met the eligibility requirements for reimbursement, including lodging, moving, transportation and meal costs, but that instead, the company "sought and obtained reimbursement for these relocation expenses under the … contract even for employees it knew did not qualify for these payments under the terms of the contract."

Because the claims resolved through the settlement were based only on allegations, no liability has been determined. Parsons, an engineering, construction, technical and management services firm based in Pasadena, CA, said, "The dispute is not related to Parsons’ performance on the SWPF contract."

Parsons began construction on the facility in 2003 and is currently working on Phase II of the project.