Navy contractor settles fraudulent accounting allegations for $4.4 million

by Ben Vernia | September 16th, 2023

On September 15, the Department of Justice announced that Navmar Applied Sciences Corp. had agreed to pay $4.4 million to settle allegations that the company double-billed the Navy on research and development contracts. According to DOJ’s press release:

Navmar Applied Sciences Corporation (Navmar), headquartered in Pennsylvania, has agreed to pay $4.4 million to resolve allegations that it violated the False Claims Act by knowingly double billing and shifting certain labor and material costs under a series of contracts with the Department of the Navy (Navy) to manufacture, design and test emerging intelligence, surveillance and reconnaissance technologies.

The United States alleged that Navmar knowingly billed certain labor and material costs on one Navy contract, subsequently billed the same costs on another contract and was therefore paid twice for the same costs. The United States further alleged that Navmar knowingly and improperly shifted material costs incurred under certain contracts to other contracts in violation of the Federal Acquisition Regulation requirement that costs incurred under a contract be allocable to that contract, resulting in Navmar recovering costs it otherwise would not have. 

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The case apparently arose from a government investigation, and not from a whistleblower’s qui tam lawsuit.

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