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Saturday, February 22, 2020

CDW to pay U.S. $5.66M for False Claims Act allegations

By Stephanie Ostrowski | Apr 5, 2013


WASHINGTON (Legal Newsline) - To resolve alleged False Claims Act violations, CDW-Government LLC (CDW-G) has agreed to pay $5.66 million for improperly charging government purchasers from 1999 to 2011.

CDW-G is a wholly-owned subsidiary of Illinois-based CDW Corporation and reseller of information technology, equipment, services, office supplies and related products.

Allegedly CDW-G charged government purchasers for shipping, sold products to the U.S. that were manufactured in China and other countries that are prohibited by the Trade Agreements Act, and underreported sales in order to avoid paying the GSA Industrial Funding Fee which is based on total contract sales that is designed to cover GSA's costs of contract administration.

"My office will not tolerate any abuse of the contracting process with the United States," said Stephen R. Wigginton, U.S. Attorney for the Southern District of Illinois. "My warning is both simple and certain: If you knowingly overcharge the United States, we will pursue all remedies available to us and we will recover the government's losses."

Announced Friday by the U.S. Department of Justice, the allegations began from a lawsuit filed in East Saint Louis, Ill federal court under the whistleblower, or qui tam, provisions of the False Claims Act. Under these provision individuals, known as relators, can sue on behalf of the U.S. and share in the relief settlement, if any.

In this case former CDW-G sales representative Joe Liotine will receive $1,585,892.56 of the total recovery as a statutory award. Liotine is subject to receive more from the defendant for attorneys' fees and costs.

"Protecting the federal procurement process is a top priority for the Department of Justice," said Stuart F. Delery, Acting Assistant Attorney General for the Department of Justice's Civil Division. "Contractors who abuse that process and undermine American trade interests will be held accountable for their actions."

The claims settled by this agreement are allegations only. CDW-G neither admits nor denies any allegations.

The settlement was the result of a combined effort by the Civil Division of the Department of Justice, the U.S. Attorney's Office for the Southern District of Illinois and the GSA Office of Inspector General.

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