NORFOLK, Va. – Fairbanks Morse Engine (FME) will pay $142,500 to settle civil fraud after their employees allegedly mischarged the Navy on a subcontract for engine repairs on the USS Ashland.
FME had two subcontracts with the Navy to perform work on the Ashland, a a firm-fixed price subcontract and a time-and-materials subcontract.
FME allegedly charged supervisory hours to the time-and-materials subcontract that should have already been included in the firm-fixed price subcontract.
After the conduct was revealed, FME submitted a disclosure to the Department of Defense Office of Inspector General under the Contractor Business Ethics Compliance Program and Disclosure Rule. The company has agreed to repay the overcharges in addition to the $142,500 to settle the False Claims Act violations.