Maryland IT Firm to Pay $14.75 Million to Settle False Claims Act Allegations

Key Takeaways

• Settlement Amount: Hill ASC Inc. agreed to pay at least $14.75 million to resolve False Claims Act allegations; the amount may increase based on future financial conditions.
• Alleged Violations: Hill allegedly billed federal agencies for unqualified IT personnel, unauthorized cybersecurity services, unapproved fees, and unallowable incentive pay.
• GSA MAS Program Misuse: The company is accused of operating outside the scope of its GSA Multiple Award Schedule contract without required technical evaluations.
• Cross-Agency Response: DOJ, GSA, Treasury OIG, and TIGTA all participated in the investigation and emphasized the importance of contractor integrity.
• No Admission of Liability: The settlement resolves allegations only; Hill has not admitted wrongdoing.

Deep Dive

A Maryland-based IT contractor has agreed to pay at least $14.75 million to settle allegations it violated the False Claims Act by overcharging federal agencies and misrepresenting its qualifications under a government-wide procurement program, the U.S. Department of Justice announced Monday.

Hill ASC Inc., operating as Hill Associates out of Rockville, allegedly billed for IT personnel lacking the education and experience required under its General Services Administration (GSA) Multiple Award Schedule (MAS) contract between 2018 and 2023. The company also allegedly provided services it wasn’t authorized to offer under that contract, particularly cybersecurity services that require special technical approval Hill hadn’t secured.

The MAS program allows federal agencies to streamline the purchase of commercial goods and services through pre-negotiated contracts. But according to federal investigators, Hill submitted invoices that went well beyond what it was cleared to do.

In addition to unqualified labor and unauthorized services, the company was also accused of charging unapproved fees, failing to disclose available prompt-payment discounts, and including unallowable incentive pay in cost submissions tied to a new contract proposal.

The $14.75 million settlement could increase if certain financial contingencies are triggered. The figure was calculated based on the company’s financial condition, according to the Justice Department.

“Information technology contractors are expected to charge the government appropriately for their services,” said Assistant Attorney General Brett A. Shumate. “We will continue to pursue cyber fraud and hold accountable those companies that knowingly fail to meet contractual obligations to the American taxpayers.”

Officials across multiple oversight agencies echoed the DOJ’s stance, emphasizing the importance of integrity in the federal contracting process.

“Federal agencies should get what they have paid for from GSA contractors, nothing less,” said GSA Deputy Inspector General Robert C. Erickson.

Treasury Deputy Inspector General Loren Sciurba noted that false claims can have “significant adverse effects to vital security concerns,” while Jessica Cipolla, Acting Special Agent in Charge at TIGTA, reiterated the importance of honesty and accountability from those doing business with the IRS or Treasury.

The resolution comes amid heightened federal scrutiny of cyber-related contracting practices. As the government increasingly relies on private-sector firms to bolster digital infrastructure and cybersecurity, regulators have signaled they will not tolerate misrepresentation or abuse of taxpayer dollars.

The claims resolved by the settlement are allegations only. Hill ASC Inc. has not admitted liability.

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