by Ben Vernia | June 30th, 2011
On June 30, the Department of Justice announced a settlement involving a Washington, D.C., based non-profit nongovernmental organization which had contracts to provide aid in Afghanistan and Pakistan. According to DOJ’s press release:
The Academy for Educational Development (AED) in Washington, D.C., has agreed to settle allegations that the company submitted false claims to the United States Agency for International Development (USAID) in connection with two cooperative agreements under which AED provided foreign assistance in Afghanistan and Pakistan, the Justice Department announced today. Although certain terms of the settlement are contingent on future events, the agreement ensures that the United States will receive more than $5 million, and potentially could receive more than $15 million, to settle these claims.
The government alleges that AED failed to ensure that its actions under two cooperative agreements with USAID complied with applicable regulations concerning competition in procurements, adherence to contract specifications, and supervision of its subcontractors. The government further alleges that AED failed to inform USAID that AED had discovered defects in AED’s systems of internal controls and that certain of AED’s subcontractors may have engaged in corruption and other wrongful activities.
The two cooperative agreements covered by the settlement are the Federally Administered Tribal Area Livelihood Development Program (FATA-LDP) in Pakistan and the Higher Education Project in Afghanistan. AED’s alleged misconduct resulted in substandard work and the government being overcharged for services and goods.
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In 2009, USAID’s Office of Inspector General learned of AED’s allegedly wrongful conduct in connection with the company’s overseas operations. As a result of additional investigation, USAID in May 2010 terminated for cause the FATA-DP agreement, one of the two cooperative agreements covered by the settlement agreement. In December 2010, USAID suspended AED from doing additional business with the federal government.