Increasingly, federal and state government agencies are focused on rooting out fraud and misconduct.

Fox Rothschild’s Government Contracts team works closely with attorneys in the firm’s White Collar Criminal Defense & Regulatory Compliance Practice to prepare clients for that intense scrutiny by implementing effective compliance programs that protect their vital interests while satisfying Federal Acquisition Regulation (FAR) Code of Business Ethics and Conduct requirements and other government mandates.

We’re particularly adept at identifying enforcement trends and working with businesses to spot potential problems. If allegations of misconduct do arise, our attorneys are experienced internal investigators, helping government contractors to determine the facts efficiently and effectively, to assess their risk and to develop a strong and thorough response.

Ethics & Compliance

When it comes to avoiding compliance issues, the best defense is a strong offense. Our government contracts team helps clients design and implement proactive ethics and compliance programs that seek to prevent internal misconduct in line with federal requirements. We work with clients to draft written Codes of Business Ethics and Conduct, create business ethics awareness and compliance training programs and install internal control systems to detect potential violations.

When it comes to training, our attorneys are experienced presenters, offering customized, interactive programs that engage employees by encouraging questions and providing specific, real-world examples of conduct to avoid. We assist clients in complying with a full range of federal requirements, including the Cybersecurity Maturity Model Certification, False Claims Act, Small Business Subcontracting Program, Davis-Bacon Act, Service Contract Act, Buy American Act and Foreign Corrupt Practices Act among others. 

Internal Investigations

When allegations of misconduct arise, we help clients get to the bottom of what actually took place. Fox conducts comprehensive internal investigations for clients, helping them ascertain the facts and understand their degree of exposure under the full array of federal regulations and statutes.

Our team includes former government prosecutors and regulators who recognize red flags and understand federal investigators’ mindset. We are experienced at representing clients facing Inspector General or Department of Justice inquiries as well as qui tam whistleblower actions filed by False Claims Act relators.

We defend clients against fraud allegations, work to persuade government entities not to join private actions, negotiate with investigators to limit the scope of inquiry where possible and find productive settlements where they are in our clients’ best interests. We also represent contractors of all sizes facing suspension and debarment proceedings, working closely with military and civilian agency Suspension and Debarment Officials to resolve such actions, preserving clients’ “present responsibility” and ability to engage in their core business.

Government aid programs such as the Paycheck Protection Program, designed to assist companies struggling financially during the COVID-19 pandemic, have resulted in an explosion of federal fraud charges. Our team tracks the latest trends in government prosecutions, ensuring clients know what investigators are focused on, what to do to avoid violations and how to respond if they become a target.

Representative Matters

• Critical Media Coverage Resulting in Internal Investigation — Represented international engineering and program management firm in a massive internal investigation of allegations contained in a national newspaper critical of the firm’s role as program manager on the California High-Speed Rail Program, a highly visible and politically charged transportation and infrastructure project. It is the largest such project in the United States.
• Subcontractor Kickback and Money Laundering Scheme — Conducted an internal audit as part of a $265 million government contract and determined that a senior vice president stole $8 million through a subcontractor kickback and money laundering scheme. Following our mandatory disclosure, the government entity performed its own audit. As a result of the quality of our work, the agency limited the audit’s scope.
• Troublesome Activity by a Senior Executive — Audited emails and financial records based on our client’s concerns regarding troublesome activity by a senior executive. Concluded the executive was engaged in multiple federal and state crimes related to prostitution and had covered up his illicit activities by charging expenses to government contracts. Protected client from prosecution by presenting findings to federal prosecutor and agency officials, which they accepted, and secured restitution from (and removal of) the executive.
• Grand Jury Investigation of Suspected Kickbacks — In a DCAA audit, responded to grand jury investigation of suspected kickbacks by a client’s mid-level employee on a government project in the Middle East. Retained a forensic accounting firm to perform our own audit and interface with DCAA and the government agency’s team. In one week, we determined the kickback allegations were not accurate, but uncovered other illegal conduct by the employee in connection with tax evasion. Swift action, self-reporting, audit and multiple meetings with the auditors and investigators convinced the government that the company was not involved in any financial wrongdoing.
• Publicly Traded Logistics Company — Conducted an internal investigation on behalf of a publicly traded logistics company regarding travel and entertainment benefits provided to employees of the Egyptian Department of Defense. Provided a report to the audit committee and board, and no violations were found as a result.
• National Federal Construction Contractor — Defense of a national federal construction contractor against civil False Claims Act allegations asserted by the Department of Justice (DOJ) and a proposed suspension and debarment brought by the Environmental Protection Agency (EPA). Client entered a favorable administrative settlement agreement with DOJ, and the EPA dismissed the proposed suspension and debarment.
• Diversified North American Construction Company — Conducted internal investigation for a diversified North American construction company of a former employee who embezzled millions of dollars. The scheme involved creating fraudulent companies, issuing subcontracts and purchase orders on government contracts and directing other, legitimate subcontractors and suppliers to inflate their invoices. The company’s cooperation with prosecutors resulted in avoidance of False Claims Act charges. Assisted in executing settlements and securing restitution.
• Federal Contractor — Conducted internal investigation on behalf of a federal contractor concerning potential fraud by multiple subcontractors. Persuaded the government to decline pursuit of civil or criminal False Claims Act charges.
• Construction Services Company — Represented a construction services company in arbitration against a subcontractor that falsified documents. Made disclosures on the company’s behalf. Cooperation with the government resulted in avoiding False Claims Act charges and a beneficial settlement with the subcontractor, whose former president was sentenced to 27 months in prison and ordered to pay fines and restitution.
• General and Civil Construction Company — Conducted internal investigation for a general and civil construction company of a former executive who allegedly charged the federal government for unallowable entertainment expenses. We uncovered evidence of improper charges and billing practices, and made a voluntarily disclosure on the client’s behalf under FAR 52.203-13 to the Office of Inspector General. Client avoided False Claims Act liability after we made an in-person voluntary disclosure to the U.S. Attorneys for the Western District of Pennsylvania.
• Global Construction Company — Conducted an internal investigation for a global construction company in connection with allegations of kickbacks and False Claims Act violations. The claims were made before the Armed Services Board of Contract Appeals relating to a project by the U.S Army Corps of Engineers at the Al Udeid Air Base in Qatar. Two weeks before trial, the government disclosed that the client’s senior project manager was being investigated by the Defense Criminal Investigative Service and the client received a grand jury subpoena. Launched an internal investigation and worked cooperatively with DOJ to respond to the grand jury.
• Contracting and Design Firm — Represented a contracting and design firm in an internal investigation and defense of a multimillion-dollar qui tam lawsuit involving six federal construction projects for the Naval Engineering and Facilities Command and the U.S. Army Corps of Engineers.
• Joint Venture — Represented a joint venture in an internal investigation involving FCA violations by a qui tam relator. We interviewed employees, reviewed documents, met with agents of the attorney general and provided detailed internal investigation memorandum and recommendations for remedial measures.
• General Contractor — Represented a general contractor in a False Claims Act qui tam action related to a large-scale, multimillion-dollar construction project for the Department of Defense.
• Large, National General Construction Contractor — Represented a large, national general construction contractor in a civil False Claims Act qui tam action. The allegations involved Small Business Subcontracting Plan fraud in a contract with the U.S. Army Corps of Engineers for the multimillion-dollar construction of a Veterans Administration Hospital.
• International Defense Contractor — Defended an international defense contractor against a proposed suspension and debarment involving federal projects under the U.S. Department of Defense Counter-Narcoterrorism Technology Program Office. Government dropped its investigation and dismissed the proposed suspension and debarment.
• Medical Equipment Supplier — Defended a medical equipment supplier in an OFAC regulatory investigation.
• Software Company — Conducted an internal investigation for a software company over potential OFAC violations.
• Manufacturing Company — Negotiated the resolution of OFAC sanctions against a manufacturing company.
• Medical Equipment Supplier — Defended a medical equipment supplier in an OFAC regulatory investigation.
• Software Company — Conducted an internal investigation for a software company over potential OFAC violations.
• Manufacturing Company — Negotiated the resolution of OFAC sanctions against a manufacturing company.
• Large Government IT Contractor — Defended an alleged “rent-a-vet” case involving set aside contracts for service-disabled veterans. Case has received national media attention due to plaintiff seeking to expand False Claims Act liability.
• Defense Contractor — Conducted internal investigation and defended defense contractor in qui tam case involving alleged substitution of military parts without government approval.
• Government Contractor — Conducted internal investigation and defended a government contractor in a False Claims Act employment retaliation claim involving alleged personal use of government property.
• Construction Company — Successfully defended construction company in small-business set aside criminal investigation.