Kamal Mustafa Al-Sultan, a former vendor of Agility, filed the lawsuit under the qui tam, or whistleblower, provisions of the False Claims Act (FCA), which permit private individuals to sue on behalf of the government for false claims and to share in any recovery. The Act also allows the government to intervene and take over the action, as it did in this case.
In its civil complaint, the United States alleged that Agility and TSC knowingly overcharged the Department of Defense for locally available fresh fruits and vegetables that Agility purchased through TSC, and falsely charged the full amount of TSC’s invoices despite agreeing that Agility would pay 10 percent less than the amount billed. The United States also alleged that Agility failed to disclose and pass through rebates and discounts it obtained from U.S.-based suppliers, as required by its contracts.
The criminal information to which Agility has agreed to plead guilty alleges conduct that was part of the pending indictment. Specifically, it alleges that in connection with one of its contracts, Agility concealed consolidation fees that should have been paid by Agility, plus an additional markup to the company, in the product price billed to the United States. As a result of Agility’s price manipulation, the United States paid an inflated price for food.
The criminal information to which Agility is pleading guilty charges Agility for one inflated invoice in an amount of less than $1,000, although the United States asserts that Agility engaged in this price manipulation whenever it used this consolidator.
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