The United States Attorney for the District of Connecticut, Marc H. Silverman, has announced a civil settlement involving Whitcraft LLC and Berkshire Manufactured Products, Inc., which are collectively known as the "Whitcraft Companies." The companies, located in Eastford, Connecticut, and Newburyport, Massachusetts, have agreed to pay $1,317,653.44 to resolve allegations that they violated the False Claims Act.
The allegations stem from the companies' activities following their acquisition in April 2017 by a private equity group. It is claimed that they ceased to qualify as "small business concerns" under Small Business Administration (SBA) regulations due to their affiliation with other businesses through stock ownership. Despite not qualifying, the companies reportedly falsely certified themselves as small businesses and obtained 71 set-aside contracts reserved for small businesses between April 2017 and November 2022.
The government requires contractors to disclose in writing any credible evidence of False Claims Act violations. On December 23, 2022, the Whitcraft Companies disclosed potential issues regarding their business affiliations during their due diligence process for a company sale. This disclosure led to credit being granted to the companies in the settlement due to their cooperation during the investigation.
The investigation was led by the Defense Criminal Investigative Service, Defense Contract Audit Agency Operations Investigative Support Division, the SBA Office of General Counsel, and DLA Aviation Fraud Counsel. Assistant U.S. Attorney Sarah Gruber handled the matter.