U.S. Attorney's Office
District of Maryland
February 27, 2025

Greenbelt, Maryland – Today, a Washington, D.C., man pleaded guilty to bribing a United States General Services Administration (GSA) official.

According to court documents, James Tillman, 57, bribed a public official (Public Official A), a former GSA contracting officer representative.  GSA is a federal agency that manages federal property.  Tillman was the sole owner of a general construction company that performed subcontracting work on GSA projects.

Phil Selden, Acting United States Attorney for the District of Maryland; Supervisory Official Antoinette T. Bacon, Justice Department Criminal Division; GSA Deputy Inspector General Robert C. Erickson, GSA Office of Inspector General (GSA-OIG); Special Agent in Charge William J. DelBagno of the FBI Baltimore Field Office; Deputy Inspector General Kelly P. Mayo, Department of Defense Office of Inspector General (DOD-OIG), Defense Criminal Investigative Service; and Inspector General Joseph V. Cuffari Ph.D., U.S. Department of Homeland Security Office of Inspector General (DHS-OIG) made the announcement.

As outlined in court documents, in 2020 and 2021, Tillman provided approximately $59,800 worth of money and items of value to Public Official A in exchange for Public Official A’s role in directing GSA federal-project work to Tillman’s company.  In 2020, Tillman paid Public Official A approximately $8,000 cash in a parking lot in Clinton, Maryland and in 2021, at Public Official A’s direction, Tillman purchased a sports car for Public Official A.  Tillman and his company grossed more than $100,000 in profits from this scheme.

Tillman pleaded guilty to conspiracy to commit bribery of a federal public official and bribery of a federal public official.  He faces a maximum penalty of 20 years in prison followed by up to three years of supervised release.  U.S. District Judge Deborah L. Boardman has scheduled sentencing for June 2, 2025 at 2 p.m.  A federal district court judge determines sentencing after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting United States Attorney Phil Selden commended GSA-OIG, FBI Baltimore Field Office, DOD-OIG, and DHS-OIG for their work in the investigation.  Mr. Selden also thanked Assistant U.S. Attorney Joel Crespo, and Department of Justice Trial Attorney Jonathan E. Jacobson, who are prosecuting the federal case. 

For more information about the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.

Source: U.S. Attorney's Office press release
 

U.S. Attorney's Office
District of Vermont
January 28, 2025

Burlington, Vermont – The United States Attorney’s Office for the District of Vermont stated that on January 28, 2025, Andrew Chaves, 25, of Washington, DC, was sentenced by Chief United States District Judge Christina Reiss to a term of two years’ imprisonment to be followed by a one-year term of supervised release. Chaves previously pleaded guilty to aggravated identity theft.

According to court records, Chaves stole two federal government vehicles from November 2023 to January 2024. He took one vehicle from a U.S. Forest Service facility in Manchester, Vermont and another from a U.S. Army facility in Lodi, New Jersey. Chaves drove both vehicles through multiple states, including Vermont, while making unauthorized purchases on credit cards he had stolen. As part of his plea, Chaves has agreed to pay over $25,000 in restitution to the United States government and his other victims. The statute of conviction prescribes a mandatory sentence of two years’ imprisonment consecutive to all other sentences. Chaves has pending state charges in Vermont, Pennsylvania and Washington, DC.

Acting United States Attorney Michael P. Drescher commended the collaborative investigatory efforts of the U.S. Department of Agriculture, Office of Inspector General, the U.S. General Services Administration, Office of Inspector General, the United States Forest Service, the Vermont State Police, the U.S. Marshals Service and the U.S. Federal Protective Service.

The case was prosecuted by Assistant U.S. Attorney Colin Owyang. Chaves was represented by Assistant Federal Public Defender Sara Puls and defense attorney Sarah Star, Esq.

Source: U.S. Attorney's Office press release

U.S. Department of Justice
Office of Public Affairs
January 7, 2025

R&K Enterprises Inc. (R&K), headquartered in Newport News, Virginia, has agreed to pay over $2.6 million to resolve allegations under the False Claims Act and the common law that the company represented that it was a small business eligible for certain small business set-aside contracts when it did not meet the program rules to qualify as a small business.

The United States alleged that R&K represented and certified in its bid that it met the size standard for the General Services Administration’s One Acquisition Solution for Integrated Services Small Business Pool 1 Contract — measured in average revenue over the previous three years from the date of the bid — when it did not. To appear to meet the size standard, R&K allegedly novated a contract to another company, K&P Management Inc. (K&P), and represented the two companies were not affiliated. The United States alleged that, under the applicable rules, the two companies were affiliated based on several factors, including that the wife of R&K’s owner owned K&P, all of K&P’s purported revenue came from R&K, the two companies shared executives and R&K exercised control over K&P. As a result, the United States contended that R&K should have included K&Ps revenue in R&K’s calculation of its size.

“Small business set-aside contracts assist small businesses to compete,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “When ineligible companies fraudulently obtain contracts reserved for small businesses, they prevent the small business community from receiving the contracting opportunities that Congress intended.”

“My office is committed to identifying, investigating and eradicating attempts to exploit programs intended to protect competition for contracts,” said U.S. Attorney Jessica D. Aber for the Eastern District of Virginia. “The complex, multi-agency investigation that culminated in this settlement exemplifies the importance of strong partnerships that maximize our expertise and authority to effectively enforce the law.”

“We will work with law enforcement partners to investigate allegations of small business fraud, including companies that misrepresent their status to get federal contracts,” said Deputy Inspector General Robert C. Erickson of the General Services Administration (GSA).

The resolution obtained in this matter was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the Eastern District of Virginia with assistance from the GSA Office of Inspector General, Small Business Administration and Department of Transportation Office of Inspector General.

Trial Attorney Danielle Rowan of the Justice Department’s Civil Division and Assistant U.S. Attorney Clare Wuerker for the Eastern District of Virginia investigated the matter.

The claims resolved by the settlement are allegations only. There has been no determination of liability.

Settlement

Source: U.S. Department of Justice press release

U.S. Department of Justice
Office of Public Affairs
January 3, 2025

Booz Allen Hamilton Holding Corporation (Booz Allen) has agreed to pay the United States $15,875,000 to resolve allegations that Booz Allen Hamilton Engineering Services LLC (BES), a wholly owned subsidiary of Booz Allen, violated the False Claims Act by knowingly submitting fraudulent claims to the United States in connection with a General Services Administration (GSA) task order to supply computer military training simulators and systems to Department of Defense (DoD) agencies, including the Air Force. Booz Allen, which is headquartered in McLean, Virginia, provides a range of management, consulting and engineering services to the government. BES was an engineering services firm located in Annapolis Junction, Maryland, with offices in Dayton, Ohio, and other locations.

The settlement announced today resolves allegations that BES, through its former program managers John G. Hancock and Karen K. Paulsen, knowingly engaged in a fraudulent course of conduct with Keith A. Seguin, then a civilian Air Force employee and contracting official, and David J. Bolduc Jr., the co-owner and manager of a BES subcontractor, QuantaDyn Corporation, that resulted in GSA awarding BES a task order for training simulators. BES, in turn, awarded task orders (or “modules”) to QuantaDyn. The government alleges that Seguin improperly and illegally divulged confidential government contracting and budget information, a competitor’s confidential bid or proposal information and source selection information to Hancock and Paulsen, who used the illicit information despite knowing they were not authorized to possess it. Through this conduct, Hancock and Paulsen successfully influenced GSA to award the task order to BES.

Additionally, the government alleges that, after the GSA award, Hancock, Paulsen, Seguin and Bolduc made use of confidential government budget information to formulate and submit price quotes to GSA for the individual modules that BES awarded to QuantaDyn on a sole-source basis. As a result of the conduct described above, BES, through Hancock and Paulsen, knowingly submitted fraudulent claims to GSA under the 37 modules awarded to QuantaDyn, which GSA paid. Hancock, Paulsen, Seguin and Bolduc previously resolved criminal charges related to this conduct.

“Government contractors that improperly receive confidential government information during the procurement process corrupt the integrity of that process,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “This settlement demonstrates our continuing commitment to protecting the integrity of the government’s procurement process.”

“Over the past several years, my office has used every tool at its disposal — from civil settlements to criminal prosecution to asset forfeiture — to hold accountable the companies and individuals that helped a corrupt federal employee at Randolph Air Force Base defraud the United States by steering training simulator contracts,” said U.S. Attorney Jaime Esparza for the Western District of Texas. “I am grateful for the assistance of the Department of Justice’s Civil Division and our law enforcement partners in finally closing the book on this fraud scheme with the civil settlement announced today.”

“This case demonstrates the unwavering dedication of the DoD Office of Inspector General’s Defense Criminal Investigative Service (DCIS), along with our law enforcement partners, to aggressively pursue those who undermine the integrity of the DoD contracting process,” said the Honorable Robert P. Storch, Inspector General of the Department of Defense. “This settlement announcement highlights the steadfast commitment of DCIS and our investigative partners to holding accountable those who seek to enrich themselves by jeopardizing the welfare of America’s warfighter and defrauding American taxpayers.”

“The GSA Office of Inspector General will continue working with law enforcement partners to protect taxpayer dollars and the integrity of federal contracting,” said GSA Deputy Inspector General Robert C. Erickson.

The civil resolution obtained in this matter was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the Western District of Texas, with assistance from the GSA Office of Inspector General (OIG); DCIS; and the Defense Contract Audit Agency (DCAA), Headquarters, Operations Investigative Support Division (OIS).

Attorneys Seth W. Greene and Art J. Coulter of the Civil Division’s Fraud Section, and Assistant U.S. Attorney Thomas A. Parnham Jr. for the Western District of Texas handled the matter, with assistance from GSA OIG Special Agent Gregory A. Fallecker.

In September 2020, the United States entered into a civil settlement agreement with QuantaDyn and William T. Dunn Jr., the majority owner, president and CEO of QuantaDyn.

The claims resolved by the United States are allegations only. There has been no determination of liability.

Settlement

Source: U.S. Department of Justice press release

U.S. Attorney's Office
Northern District of Ohio
January 3, 2025

CLEVELAND – The U.S. Attorney’s Office for the Northern District of Ohio is spearheading a new, interagency Supply Chain Oversight and Procurement Enforcement (SCOPE) Task Force, created in 2024, to ensure supply chain integrity and prevent procurement fraud. The task force will serve to support the work of the Government Supply Chain Investigations Unit (GSCIU), led by the Department of Homeland Security – Homeland Security Investigations (HSI), based in Washington, D.C.

The GSCIU investigates procurement and government contract fraud in connection with military, law enforcement, and public health and safety. Examples include investigations into substandard or fraudulent vaccines or medications that are supplied to veterans through Veterans Affairs. Other investigations have focused on faulty electronics and software provided to NASA or the military supply chain, and counterfeit and faulty armor and munitions provided to law enforcement and military personnel.

“As the first of its kind in the district, this task force brings together the USAO’s white collar crime unit, Homeland Security Investigations, and numerous other federal investigative agencies to address large-scale supply chain and procurement fraud in government contracting,” said U.S. Attorney Rebecca Lutzko for the Northern District of Ohio. “We also must be vigilant about products entering the government supply chain stemming from prohibited sources or foreign countries of concern, which presents a national security issue that may potentially sabotage or compromise systems put in place to protect our country, our servicemen and servicewomen, and our citizens.” 

The task force will hold its first meeting in early February. Topics of discussion will emphasize public health and safety, vaccine and medicine fraud, counterfeit goods, intellectual property theft, and national security. Regional federal agencies that have committed to the USAO-NDOH-led task force include the FBI, NASA, HSI, NCIS, Intellectual Property Rights Center, Defense Criminal Investigative Services, Air Force Office of Special Investigations, Veterans Affairs, General Services Administration, Customs and Border Protection, IRS-Criminal Investigation, U.S. ARMY, and Defense Finance Accounting Service.

Source: U.S. Attorney's Office press release

U.S. Attorney's Office
District of Massachusetts
January 3, 2025

BOSTON – S.A.F.E. Structure Designs, U.S.A. Manufacturing, and their owner, Johnny Buscema, Jr., have agreed to pay $1 million to resolve allegations that they violated the False Claims Act by submitting, or causing the submission of, false claims on a prime vendor contract with the Defense Logistics Agency (DLA), which the Department of Defense (DoD) uses to purchase goods and services.

S.A.F.E. Structure, based in Las Vegas, Nev., sells safety equipment, and USA Manufacturing, based in Port Ritchey, Fla., is a general construction company. Buscema, of Port Richey, owns and operates both companies.

S.A.F.E Structure and USA Manufacturing were vendors to Noble Sales Co., Inc. d/b/a Noble Supply & Logistics (Noble), which is a Boston-based prime contractor to DLA for Maintenance, Repair, and Operations (MRO) contracts for the Northeast and Southeast regions. Under the MRO contracts, the DoD can place orders for goods and services through Noble, and Noble is required to solicit bids from two independently competing vendors for transactions below $25,000, and from three independently competing vendors for transactions at or above $25,000. According to DLA, MRO contracts are “a partnership aimed at achieving infrastructure savings, inventory cost reductions, and favorable product pricing through leveraged buying.”

Pursuant to the settlement agreement, Buscema, S.A.F.E. Structure, and USA Manufacturing admitted that, from 2014 to 2023, they coordinated with Noble or other vendors to submit bids on the MRO contracts. For example, Buscema and his companies admitted that, at Noble’s request, they submitted over 100 bids—which they called “courtesy bids” or “comps”—where Buscema and his companies had no intention of winning the business.  For these “courtesy bids” or “comps,” Noble provided Buscema and his companies with the specific prices that Buscema’s companies should bid or a price that the bids should exceed. As a result, vendors other than S.A.F.E. Structure or USA Manufacturing won the business. Buscema also admitted that he paid two other vendors to submit at least 60 “courtesy bids” or “comps,” so that S.A.F.E. Structure or USA Manufacturing won the business. Buscema also admitted that, on occasion, he provided a bid from S.A.F.E Structure and a bid from USA Manufacturing for the same solicitation, even though Buscema owned both companies, and that Noble was aware that Buscema owned both companies. The United States contends that claims under the MRO contracts resulting from these coordinated bids were false under the False Claims Act, and that the DoD paid more under the MRO Contracts as a result.

“As evidenced in this settlement agreement, these contractors gamed the system to line their own pockets.  They manipulated and undermined the fair and open bidding process designed to save our military – and taxpayers – money. Contractors should be scrupulous in dealing with the government, not coordinating with each other to pad their bottom line,” said United States Attorney Joshua S. Levy. “When defense contractors collude, rather than compete, they violate the law and the public’s trust.”

“Those who seek to do business with the government are expected to compete fairly and independently to ensure that the government receives an appropriate price,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department will hold accountable government contractors that engage in bid rigging or otherwise seek to defraud the American taxpayers.”

“The Department of Defense (DoD) expects its contractors to compete in open and fair markets,” said Patrick J. Hegarty, Special Agent in Charge of the DoD’s Office of Inspector General’s Defense Criminal Investigative Service, Northeast Field Office. “Today’s announcement demonstrates our commitment to work with our law enforcement partners to investigate allegations of anticompetitive practices and ensure the integrity of the DoD’s procurement process.”

“Department of the Army Criminal Investigation Division works diligently to maintain the Army’s readiness and will continue to work closely with our law enforcement partners to prevent and thoroughly investigate fraudulent activity,” said Special Agent in Charge Keith K. Kelly of the Department of the Army Criminal Investigation Division (CID)’s Fraud Field Office. “CID is committed to providing expertise and capabilities supporting whole of government efforts to ensure the U.S. Army remains the most technologically advanced, capable, and ready fighting force in the world.”

“GSA OIG remains committed to working closely with its law enforcement partners to protect American taxpayer dollars and government programs from fraud,” said Special Agent in Charge Joseph Dattoria, U.S. General Services Administration, Office of Inspector General (GSA OIG), Northeast Field Investigations Division.

U.S. Attorney Levy, Deputy AAG Boynton, DCIS SAC Hegarty, ARMY CID SAC Kelly and GSA SAC Dattoria made the announcement. This matter was handled by Assistant U.S. Attorneys Brian LaMacchia and Lindsey Ross for the District of Massachusetts, and Trial Attorney Samson Asiyanbi of the Justice Department’s Civil Division. 

Source: U.S. Attorney's Office press release

U.S. Attorney's Office
Middle District of Florida
December 6, 2024

Jacksonville, Florida – United States Attorney Roger B. Handberg announces that Luis Edel Trujillo Pena (29, Miami) has pleaded guilty to conspiracy, wire fraud and aggravated identity theft. Pena faces up to 20 years in prison on the wire fraud count, up to 5 years’ imprisonment on the conspiracy count and a minimum penalty of 2 years in prison on the aggravated identity theft count, and payment of restitution to the victims he and his co-defendants defrauded. A sentencing date has not yet been set.

According to court documents, Pena and his co-conspirators worked together to install skimmers on gas pumps at gas stations in Alabama, Louisiana, and Northern Florida, including the Florida Panhandle. The conspirators used the skimmers to illegally obtain credit and debit card account numbers connected with the purchase of fuel by customers at the gas pump. Using the account numbers stolen by the skimmers, Pena and his co-conspirators made counterfeit credit and debit cards. Pena then distributed the counterfeit credit and debit cards to his co-conspirators to purchase large amount of diesel fuel.

During the conspiracy, Pena and others drove vehicles that contained a fuel bladder system. This system allowed the conspirators to fake pumping gas into the vehicle’s gas tank when in fact the diesel fuel was being pumped into the fuel bladder system. Analysis by law enforcement of fuel purchases, vehicle tracker data, gas station video surveillance, and real time surveillance of the conspirators determined that Pena and other conspirators drove to multiple gas stations throughout Northern Florida. After obtaining the gas, Pena directed the conspirators to offload the stolen fuel into 9,500-gallon tanker trucks at a fuel yard. The stolen fuel was then sold to a gas station associated with one of the co-conspirators.

Deonelky Tabares Cid (36, Tampa) previously pleaded guilty to conspiracy, four counts of wire fraud, six counts of access device fraud, and one count of aggravated identity theft for his role in this case. He is pending sentencing.

Deyvis Hernandez (37, Miami), Luis Ernesto Vigil Ochoa (32, Miami), and Isvaldo Guerra Perdomo (38, Jacksonville) are set for trial in January 2025.

An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.

This case was investigated by the Federal Bureau of Investigation, the Florida Department of Agriculture and Consumer Services, the Florida Highway Patrol, the Jacksonville Sheriff’s Office, U.S. General Services Administration - Office of Inspector General and the U.S. Secret Service – Jacksonville Field Office. It is being prosecuted by Assistant United States Attorney Kevin C. Frein.

Source: U.S. Attorney's Office press release

U.S. Department of Justice
Office of Public Affairs
December 2, 2024

Gen Digital Inc. (formerly known as Symantec Corp.), located in Tempe, Arizona, paid $55.1 million to satisfy a judgment, concluding a decade of False Claims Act litigation. The judgment required the company to pay $16.1 million in damages and $36.8 million in civil penalties, plus post-judgment interest and costs.

“The department will hold accountable contractors that knowingly overcharge the United States to enrich themselves,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The years spent litigating this case and taking it to trial demonstrate the department’s steadfast commitment to protecting taxpayer funds.”

Following a four-week bench trial in February and March 2022, the trial court found Symantec liable for making knowing false claims to the United States when it mispresented its commercial sales practices during the negotiation and subsequent performance of a General Services Administration (GSA) contract. In particular, the court concluded that Symantec made false statements to GSA during contractual negotiations in 2006 and early-2007 and continued to falsely certify throughout the performance of the contract through Sept. 30, 2012, that its disclosures of its commercial sales practices were current, accurate and complete. The false disclosures induced GSA to accept and then continue to pay higher prices than it would have had it known of Symantec’s actual commercial pricing practices.

The court also found that Symantec continuously violated the Price Reduction Clause, a standard term in these types of Multiple Award Schedule contracts that requires the contractor throughout performance of the contract to maintain GSA’s price position in relation to an identified customer or category of customer agreed upon in contract negotiations. These violations deprived the United States of discounts to which it was entitled.

“The trial team secured a $55 million judgment that holds accountable a contractor who intentionally tried to overbill the government,” said U.S. Attorney Matthew M. Graves for the District of Columbia. “Because these schemes steal taxpayer dollars, the United States Attorney’s Office for the District of Columbia will be steadfast in its efforts to bring fraudsters to justice no matter the complexity of the matter, pursuing them through trial, if necessary, to secure a just outcome.”

“The United States deserves fair prices and accurate information from GSA contractors,” said GSA Deputy Inspector General Robert C. Erickson. “This outcome is the result of hard work and dedication by a cross-functional team from the U.S. Department of Justice, GSA and GSA Office of Inspector General.”

Gen Digital’s payment ends a lawsuit filed under the qui tam or whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The Act permits the United States to intervene and take over responsibility for litigating these cases, as the United States did here. The qui tam case is captioned United States ex rel. Morsell v. Symantec Corp., Civ. A. No. 12-0800 (DDC), and was brought by Lori Morsell, who administered the contract at issue for Symantec. Her share of the recovery has not yet been determined.

This successful litigation was a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the District of Columbia, with assistance from GSA’s Office of General Counsel and Office of Inspector General.

Senior Trial Counsel Daniel Schiffer and Trial Attorney F. Elias Boujaoude of the Justice Department’s Civil Division and Civil Chief Brian P. Hudak for the District of Columbia handled the matter.

Source: U.S. Department of Justice press release

U.S. Department of Justice
Office of Public Affairs
November 22, 2024

Yesterday, the Justice Department’s Antitrust Division and Procurement Collusion Strike Force (PCSF) commemorated the PCSF’s fifth anniversary in Washington with a celebration involving law enforcement partners and key stakeholders from across the government. Assistant Attorney General (AAG) Jonathan Kanter, PCSF Director Daniel Glad and other department officials were joined by representatives from among the PSCF’s 12 national law enforcement partners and 25 U.S. Attorneys’ Offices and other key stakeholders from the law enforcement and oversight community.

The PCSF fifth anniversary event featured remarks from AAG Kanter, who noted the PCSF’s growing impact and the importance of criminal antitrust enforcement. Director Glad offered welcome remarks recounting the PCSF’s history, mission and future. Department of Interior Inspector General and Council of the Inspectors General on Integrity and Efficiency Chair Mark Greenblatt highlighted the effectiveness of the PCSF’s collaborative model and that, even in light of its substantial gains over the last five years, more of the PCSF’s work is needed to combat the growing risks in contract and grant oversight.  

The anniversary featured several panels composed of PCSF partner agency representation. Acting Department of Commerce Inspector General Jill Baisinger and U.S. Postal Service Inspector General Tammy Hull discussed present and near-future procurement oversight threats that their agencies are facing, and the mitigation tools they have deployed to address those threats. Expert panelists from Department of Defense Office of Inspector General (OIG) and the U.S. Agency for International Development OIG discussed global and international considerations. The anniversary concluded with a panel discussion featuring expert panelists from the Department of Transportation OIG, General Services Administration OIG and Environmental Protection Agency OIG, who discussed data, analytics and collaboration driving future PCSF enforcement efforts.

The PCSF is the Justice Department’s coordinated, joint law enforcement effort to combat antitrust crimes and related fraudulent schemes that impact procurement, grant and program funding at all levels of government — federal, state and local.

Since its inception in November 2019, the PCSF has opened more than 145 criminal investigations and trained more than 39,000 people. In that time, the PCSF and Antitrust Division have obtained over 60 guilty pleas and trial convictions and have investigated and prosecuted over 85 companies and individuals involving over $575 million worth of government contracts and contract kickbacks.

AAG Kanter’s remarks can be viewed here.

Director Glad’s remarks can be viewed here.

Chair Greenblatt’s remarks can be viewed here.

Source: U.S. Department of Justice press release

The General Services Administration (GSA) Office of Inspector General is aware of continued scams involving disguised or “spoofed” email addresses that target small businesses and large businesses, including federal contractors registered in SAM.gov.

Scammers falsely claiming to be employees of a federal government agency use such “spoofed” email addresses to solicit fraudulent Requests for Quotations (RFQs). The fraudsters generally seek RFQs for electronic equipment (cell phones, laptops, tablets, and other electronic devices). These “spoofed” emails appear to originate from government email domains, including “.gov” or “.mil”, but have non-government domain extensions such as “.net”, “.org”, or “.com.”

•    John.Doe@gsa-org.com (fake)
•    John.Doe@dhs-usa.org  (fake)
•    John.Doe@dod-mil-us.net (fake)

When a U.S.-based business responds to the RFQ, the fraudster replies using an email address that is similar to a legitimate government email address but has a non-government email domain extension. The fraudulent RFQs also appear nearly identical to legitimate RFQs used by federal government agencies, often using the names of real agency officials. However, the fraudulent RFQs have illegitimate contact information, including email addresses and phone numbers that send any correspondence back to the fraudsters and not to any legitimate government entity.

If a business entity responds to the RFQ, the fraudster will accept the quote, provide a fraudulent Purchase Order (PO) and the business is provided with an address to which they can ship the devices. The PO will usually include the “signature” of the federal official, likely copied and photoshopped from publicly available contract files. Payment is usually guaranteed within 30 calendar days of the goods having been received (“Net 30"). The shipping addresses vary, but are typically commercial addresses accessible by the public, such as short-term storage companies, warehouses or freight forwarders. When the U.S.-based business submits an invoice for payment to the affected government agency, the invoice is rejected, or no response is provided to the business because the government agency has no records of the fraudulent procurement. At this stage, the business realizes it has been defrauded.

Elements of the Fraud

• Sending fake quote requests and fake purchase orders. Scammers can gather public information and agency logos from legitimate sources, combine it to make a fake document, and then send it to federal contractors pretending to be procurement officials from federal agencies, state or local governments, hospitals, or universities.
• Using email addresses designed to trick you. Scammers create fake email addresses which are similar to the legitimate government, university, or hospital email addresses. They could also display a different email address in the “From” header than what they use for the “Reply-To” email address.
• Trying to order things the scammers can easily resell. These items include computers and related equipment, printer toner, projectors/cameras, medical and pharmaceutical equipment, and industrial equipment.
• Instructing victims to ship goods to addresses not connected to the organization they are impersonating.
• Sending email messages which are poorly written, with misspellings and awkward sentence structure.
• Creating a sense of urgency. Scammers may ask you to supply large quantities of product and rush you to ship priority or overnight.

Protect Yourself and Your Company

• Review any unsolicited requests for quote (RFQ) or purchase order (PO) carefully.
• Locate the phone number for the listed procurement official using an independent source. Call them to make sure the RFQ or PO is legitimate.
• Check the email address. Make sure the sender’s domain and the “Reply To” header is the correct domain affiliated with the government agency, college, or hospital. You can also hover over the email address in the “From” header without clicking on it to confirm whether it matches the valid domain.
• Search the Internet for the listed delivery address. See if your search returns an address actually affiliated with the agency, university, or hospital. Beware of those addresses that return an individual residence, self-storage facility, virtual office, or shipping and packing store.
• Be suspicious of any purported procurement officials who refuse to communicate by telephone.
• Research the company’s website and contact information and compare it to any unsolicited RFQs or POs received from purported government contractors. Look for anomalies. Also, research the original RFQ and award information between the company and the government and attempt to confirm the authenticity of the RFQ with the procurement official.

Fraud Reporting

If you believe you have been either solicited or victimized by one of these procurement scams, report the incident immediately to the FBI’s Internet Crime Complaint Center at https://www.ic3.gov/default.aspx.

If the scam involved the impersonation of a government agency or official, also report it to that agency’s Office of Inspector General. Go to https://www.ignet.gov/content/inspectors-general-directory for a list of agency Offices of Inspector General and their hotlines.

If you have information about fraud, waste, abuse, mismanagement, or other crimes or violations of federal laws, rules, and regulations relating to GSA programs and operations, including contracts, please report it to the OIG Hotline. You can submit your complaint at https://www.gsaig.gov/hotline.