Dynamics Research Corporation settles lawsuit alleging fraud related to Air Force contracts

September 11, 2009  |  Class Actions, Press Releases, Whistleblower/Qui Tam

Massachusetts-based Dynamics Research Corporation has entered into a substantial financial settlement with the United States to resolve the government’s lawsuit filed against the company in federal court in Boston. The suit, seeking damages and penalties under the False Claims Act and the Anti-Kickback Act, alleged that two Dynamics Research former vice presidents had participated in a fraudulent kickback scheme related to contracts with the Air Force.

In 1996, Dynamics Research was awarded two government contracts for the company’s assistance in the Air Force’s acquisition of computer equipment and related services for the Theater Battle Management Core Systems (TBMCS) operation located in Massachusetts at Hanscom Air Force Base. TBMCS is an integrated system that the military uses to create air battle plans. The contracts with Dynamics Research required the company’s employees to affirm that they and their family members had no financial interests that would compromise the employees’ ability to give unbiased advice. Dynamics Research did not obtain the required certificates from the two vice presidents who headed the project – Victor Garber and Paul Arguin The government alleged that from 1997 to 2000, Garber and Arguin recommended that the Air Force enter into contracts with companies owned by the two men and Arguin’s wife. The men then essentially paid themselves kickbacks and charged the Air Force inflated contract prices, sometimes for services and products that failed to comply with government specifications.

For the full story, go to the Department of Justice’s Press Release.

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