DHS Technologies LLC and subsidiary DHS Systems LLC recently agreed to pay $1.9 million to settle claims it defrauded the federal government by failing to disclose that it offered greater discounts to a commercial company as part of the renewal of its General Services Administration (GSA) Federal Supply Schedule contract in 2007.
Sharon McKinney, a former employee-turned-whistleblower, initiated the lawsuit under the qui tam provision of the False Claims Act. The contract was part of the GSA’s Multiple Award Schedule program that allows the government to order commonly used products and services from a list of approved vendors. These vendors are required to provide the government with complete and accurate information about prices charged to commercial customers to enable the agency to obtain the same or better pricing. Specifically, McKinney alleged that DHS Technologies failed to inform GSA of its lower prices for emergency mobile shelters offered to its largest commercial customer, Northrop Grumman. DHS’ failure to provide this complete information led to the overpayment, by the government, for these mobile shelters from 2007 thru 2013.
The defendant companies, based in Orangeburg, N.Y., did not admit wrongdoing in the settlement. As part of the settlement, McKinney will receive 19% of all payments obtained by the government.
The DOJ press release on the DHS Technologies settlement can be found here.