Dell settles charges that it overcharged the US military for computer contracts
- Dell and Iron Bow are accused of violating the False Claims Act by overcharging the U.S. military
- Together, the two companies will pay $4.35 million in settlements
- A Dell whistleblower receives 6.6% of Dell’s payout
Dell Technologies and Iron Bow Technologies have agreed to pay more than $2 million each to resolve allegations that they overcharged the U.S. military under a government computer contract.
The settlements, confirmed in a announcement by the U.S. Department of Justice, addressing claims of “uncompetitive bidding” submitted by the companies to win military contracts at inflated costs.
Dell will pay out $2.3 million, while Virginia-based Iron Bow will pay $2.05 million to settle the claims.
Dell and Iron Bow Settlements
According to the DOJ, Dell operated a deal registration program that gave Iron Bow preferential pricing for Dell computer hardware. This then allowed Iron Bow to make lower bids to the military, while Dell made higher bids to direct the military to Iron Bow.
Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division, said: “The United States relies on competition to get the best value and price for American taxpayers.”
U.S. Attorney Prim F. Escalona for the Northern District of Alabama added: “Fraud in the government contracting process costs taxpayers untold dollars every year… We will continue to work with our federal law enforcement partners to investigate and bring to justice those who commit government contract fraud. prosecute. ”
The settlement also aims to resolve a whistleblower lawsuit brought by Brent Lillard, an executive at another IT reseller, under the False Claims Act. A portion of $345,000 of Dell’s $2.3 million payout is earmarked for Lillard.
This isn’t the first time software and hardware vendors have been accused of overcharging the U.S. government and its agencies. Earlier this month, the DOJ shared two cases of fraudulent IT contracts, which led to six individuals being charged or charged.
German company SAP was also raided by the FBI amid a lengthy investigation into allegations that the company overcharged the U.S. government and military for the use of its software.
