Colorado energy company pays $14.4 million to settle False Claims Act allegations

by Ben Vernia | July 8th, 2018

On July 6, the Department of Justice announced that North American Power Group, Ltd., agreed to pay $14.4 million to resolve allegations that the company violated the False Claims Act in its contract with the Department of Energy. According to DOJ’s press release:

North American Power Group Ltd. (NAPG) and its owner and president, Michael Ruffatto, have agreed to pay the United States $14.4 million to resolve allegations that they violated the False Claims Act by submitting fraudulent claims under a cooperative agreement with the Department of Energy (DOE) National Energy and Technology Laboratory (NETL), located in Pittsburgh, Pennsylvania, the Department of Justice announced today.

Based in Greenwood Village, Colorado, NAPG develops, owns, operates and manages energy-related projects.  On December 8, 2009, NETL awarded a $14 million cooperative agreement to NAPG for a Carbon Site Characterization Project to collect and analyze data, as well as to design and implement carbon sequestration wells at the Two Elk Energy Park (TEEP) located in Campbell County, Wyoming.   Between December 2009 and January 2012, Ruffatto served as NAPG’s representative for the cooperative agreement and was responsible for authorizing the submission of the company’s invoices to NETL for payment.  During that time, NAPG was paid approximately $5.7 million by NETL for costs purportedly related to the project.  In fact, however, none of the claimed costs were for work associated with the project and instead reflected expenses incurred by Ruffatto to pay legal fees, car payments, jewelry, international travel and other personal items unrelated to the scope of work under the cooperative agreement.  The DOE suspended the cooperative agreement in January 2012 after discovering the fraudulent claims.

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