An Alaska-based telecommunications provider agreed to pay more than $40.2 million as part of a settlement agreement announced Thursday with the Department of Justice (DOJ) for alleged violations of the False Claims Act (FCA).

GCI Communications Corp. was accused of violating Federal Communications Commission (FCC) competitive bidding regulations by “knowingly inflating its prices” in connection with its participation in the Rural Health Care Program (RHCP), the DOJ said in a press release. The program provides money each year to aid rural healthcare providers with their telecommunications needs.

The details: Between 2013-20, GCI failed to comply with FCC regulations and received greater subsidy payments than it was entitled to, according to the DOJ. The company also allegedly caused Eastern Aleutian Tribes, a rural healthcare provider in Alaska, to agree to inflated prices from 2015-18.

“Telecommunications providers that seek to participate in important FCC programs like the [RHCP] must comply with applicable rules, including those governing how they competitively bid on contracts and set their prices,” said Principal Deputy Assistant Attorney General Brian Boynton, head of the DOJ’s Civil Division, in the press release.

The civil settlement resolves claims brought under the qui tam provisions of the FCA by Robert Taylor, GCI’s former director of business administration. Taylor will receive more than $6.4 million as part of the settlement.

Compliance ramifications:...

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