Combating fraud starts with you!

  • Published
  • By SA Daniel Barthold
  • Air Force Office of Special Investigations
ARNOLD AIR FORCE BASE, TENN. --  Wars cost money, as does maintaining vigilance.

The U.S. government spends hundreds of billions of your tax dollars each year on national defense. Uncle Sam utilizes these dollars to support weapons systems and platforms which equip our service members and workforce to maintain national security. When this resource is fraudulently wasted our capabilities are reduced because the money could have gone to other projects which maintain and improve our technological edge.

Fraud endangers the mission. There are many schemes and indicators to help you recognize fraud occurring on AEDC. Below is a description of some of the more common ways in which defense contractors have
tried to defraud the federal government:

Product Substitution. Defense contracts frequently specify that the contractor use a particular grade, type or quality of product or parts. Defense contractors can often save costs, and maximize profits if they substitute cheaper or substandard parts. If a defense contractor does this without the permission of the government’s contracting officer, it can violate the Federal False Claims Act.

Worthless or Substandard Products or Services. Due to the volume and complexity of the equipment and products the Air Force purchases, it is nearly impossible for the Air Force to perform a quality check on each item. In many cases, the Air Force relies upon the defense contractor to provide products that perform as promised per the contract.

Though there are cases of honest mistakes, there are also instances where the contractor knew, or was reckless in not knowing, the products they delivered would not perform as promised. Such worthless or substandard products can have devastating impact on the men and women of the military that use them and potentially violate the Federal False Claims Act.

Failure to comply with contract specifications. Reliability is critical and the Department of Defense requires its contractors to perform in accordance detailed product specifications. These specifications dictate the type of materials to be used and the appropriate quality assurance steps the company must follow to ensure product quality. Although the burdens imposed by the specifications are costly, the government covers those costs as part of the contractor's payment. If a company starts to overrun its budget on a contract, particularly a fixed-price contract, or falls behind in its delivery schedule, it may be tempted to cut corners by omitting required testing, quality procedures or other steps in the production process.

Federal Employees’ Compensation Act (FECA) Fraud. Air Force civilian employees injured while performing their official duties are eligible to obtain compensation under provisions of the FECA. Although the FECA is administered by the Department of Labor, payments are charged back to the individual employing agencies, e.g. the Air Force, for reimbursement. The Air Force pays a significant amount of money for legitimate claims made by individuals who had been injured while on the job and who can no longer work because of those injuries. However, some individuals will fake or exaggerate an injury in order to receive money from the Air Force.

AFOSI needs your help to identify potential fraud in the work place. Defense contractor fraud remains one of the most active areas of false claims litigation under the Federal False Claims Act. We all have a part in the fight. If individuals believe they have information pertaining to potential fraud, they can immediately report it to the local OSI detachment. Detachment 106 is located in Bldg. 100, Suite C305 on Arnold Air Force Base. OSI works to prevent fraud and to recover losses to the U.S. government. If you would like a fraud brief in your section let us know. For more information, contact AFOSI Detachment 106 at 931-454-7820 or text the AFOSI Anonymous Tip Line by texting “AFOSI” plus your tip information to 274637 (CRIMES).

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