A construction materials contractor has plead guilty to criminal charges and settled a whistleblower lawsuit for $2.5 million and a $500,000 criminal fine for falsifying records and cheating on government contracts including among its victims the Rockford, IL courthouse, as well as the Miami Intermodal Center, Palo Alto Medical Center and many other construction contracts.
By the plea Novum Structures admitted to a complex scheme of substituting structural components manufactured in the People’s Republic of China and elsewhere as “Made in the USA” in government buildings and projects.
According to Brian Mahany, the whistleblower attorney representing ex-employee Brenda King who exposed the fraud in a False Claims Act lawsuit:
- Novum’s fraud included habitually repackaging foreign steel products to reflect a “Made in USA” origin, fraudulently falsifying records with Material Test Numbers taken from legitimate U.S. products, and demanding employees lie if questioned,
- Novum’s conduct violated the Buy America Act and the Buy American Act – both designed to protect U.S. jobs, help the U.S. economy, and assure verifiable quality in federally funded construction.
The U.S. False Claims Act (FCA) allows private citizens to file whistleblower lawsuits on behalf of the People of the United States, to recover money from private companies who cheat government programs – earning cash rewards of 15 to 30 per cent of amounts recovered.
In the past several years FCA lawsuits have brought some $20 billion taxpayer dollars lost to fraud back to the government, a news release issued by Mahany says.