On July 21, the Department of Justice announced that Booz Allen Hamilton Holding Corporation (Booz Allen) agreed to pay $377 million to resolve allegations of False Claims Act (FCA) violations. Booz Allen, according to its website, is a global firm of approximately 29,200 employees. The government alleges that Booz Allen improperly billed the government for consulting contracts. Government contracting rules stipulate that companies may only bill the government for direct or indirect costs that are connected to the overall objectives of their contract.
Based on revelations made by whistleblower Sarah Feinberg, a former Booz Allen employee, the government built its allegations that the company improperly allocated costs to the government that had no relationship to the underlying contracts. According to the allegations, between 2011 to 2021 Booz Allen charged the government for costs “that provided no benefit to the United States.”
The whistleblower, Feinberg, filed a civil suit under the qui tam provision of the FCA. Qui tam claims enable private citizens to file lawsuits on behalf of the government if they know of an individual or company defrauding the government. Qui tam whistleblowers are eligible to receive between 15 and 30% of the government’s recovery. Feinberg will receive just shy of $70 million.
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