The United States government employs defense contractors to build and maintain the nation’s defense infrastructure. These assignments include everything from building warships and aircraft to researching and developing new weapons technologies.
The desire for national security and appreciation for the service of the military can keep citizens from questioning such contracts. However, the lucrative business of defense attracts unsavory characters looking to make easy money, so a concerned individual should understand the types of potential fraud.
Manufacturing processes can result in a defective product. When a manufacturer attempts to pass off a faulty product as acceptable, this fraud brings liability. In defense contracts, a defective product risks lives and national security. A contractor must report when it discovers that a part cannot perform as a contract states. Likewise, intentionally providing substandard equipment or improperly substituting parts or products that do not function correctly is fraudulent and dangerous.
Fraudulent accounts and bills
A defense contractor may commit cross-charging fraud by billing the government for excess hours on a particular project, overcharging for materials or using inferior materials. A contractor may negotiate a fixed-price or cost-plus contract but cannot interchange the manner of charging expenses to receive more money. The offense can result in prison time and heavy fines.
Other contractors have billed the government for products and services they did not provide. Since contracts may cover years and millions of products, sufficient auditing is difficult, and authorities may miss unfulfilled agreements.
Defense contractors are an integral component of the strength of the U.S. military. Well-intentioned individuals who speak up when noticing fraud can save numerous lives and receive the wholehearted appreciation of officials and citizens.