CSC pays $1.37M to end Justice probe

Computer Sciences Corp. has agreed to pay $1.37 million to settle claims it solicited and received improper payments and other items of value on technology contracts with government agencies, the Justice Department announced Tuesday.

The settlement resolves an action filed against CSC by whistle-blowers Norman Rille and Neal Roberts in September 2004 under the False Claims Act. After an investigation, Justice joined the action.

The complaint alleged that CSC knowingly solicited and/or received payments of money and other things of value, known as alliance benefits, from a number of companies with which it had global alliance relationships.

"We can confirm that we have settled this matter, but we emphatically deny that CSC engaged in any false claims or other wrongdoing in association with this case," said Mike Dickerson, a company spokesman.

Justice said the government intervened because the alliance relationships and resulting benefits amounted to kickbacks and undisclosed conflict-of-interest relationships in violation of contractual provisions and the applicable provisions of the Federal Acquisition Regulation.

The action against CSC was part of a larger ongoing investigation of government technology vendors and consultants following complaints filed against Accenture LLP, Hewlett-Packard Co. and Sun Microsystems Inc.

Last August, PricewaterhouseCoopers and IBM Corp. settled similar charges stemming from the same investigation. Although they denied any wrongdoing, IBM agreed to pay $2.97 million, and PWC paid $2.3 million.

Under the qui tam provisions of the False Claims Act, people who file successful actions alleging fraud against the government receive a share of any resulting recovery. Justice said the amount Rille and Roberts will receive has not yet been determined.

CSC, of Falls Church, Va., ranks No. 9 on Washington Technology's 2008 Top 100 list of the largest federal government prime contractors.