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Federal Contractor Misconduct Database (FCMD)

The federal government routinely awards contracts to companies with histories of misconduct, including contract fraud and other violations. POGO believes that providing this website will help to improve contracting decisions and increase public knowledge of how the government spends billions of taxpayer dollars each year. Read more…

Excessive Subcontract Costs

The DCAA (Defense Contract Audit Agency) “has identified issues related to the reasonableness of negotiated subcontract costs for DFACs (Dining Facilities). KBR has been unable to support the reasonableness of subcontract prices or the appropriate billing methodology intended in its subcontracts.” Billed headcount numbers [at these facilities] exceeded the actual meals served by at least 19 percent according to KBR’s own studies and could be as high as 36 percent based on on-going DCAA analysis. Initially, DCAA and KBR agreed on a withholding of $176.5 million until additional supporting data could be provided by KBR…[however] the DCAA has currently increased its suspended DFAC costs to $186 million.” As reported in its 2005 10-K, the government eventually agreed to withhold $55 million.

Misconduct Type
Government Contract Fraud
Enforcement Agency
Defense – Army
Contracting Party
Defense - Army
Court Type
Administrative
Disposition
Administrative Agreement
Date of Testimony
6/9/2004
Contractors Involved Penalty
Total
KBR $55,000,000
Further Information Released
10-K (p. 20 of 145) 7/13/2007
DCAA Testimony (pp. 2-3) 8/29/2006

Federal Contractor Misconduct Database