NY Estimating Consultant Settles $3.1M Government Project Fraud Case
VJ Associates, a Hicksville, N.Y., estimating consultant, has agreed to pay $3.13 million in civil and criminal penalties to settle charges that the firm overbilled and falsified hours on multiple federal and state government-funded transportation and other contracts in New York and Massachusetts, the U.S. Attorney's office in Boston announced on Oct. 29.
Between 2007 and 2018, the bill-padding scheme on projects funded by the U.S. Transportation Dept., New York and Massachusetts agencies, and the Port Authority of NY and NJ, generated about $1.2 million in over payments.
“VJ Associates defrauded government-funded infrastructure projects by billing for bogus hours,” said U.S. Attorney Andrew E. Lelling in an Oct. 29 statement. “Our office is committed to protecting ... the integrity of federally funded infrastructure programs."
The projects VJ Associates falsely billed for included the MBTA Charlestown Bus Facility, renovations at Taunton State Hospital, and the Massport Hanscom Airport Rescue and Fire Fighting Facility for the Massachusetts Port Authority. The firm, which provided subcontracted estimating and scheduling services, "badly" overbilled PANYNJ, said the US Attorney's office.
A spokeswoman said the office could not comment further.
In a guilty plea in federal court, VJ Associates and units based in New England, New Jersey and Washington, D.C. agreed to pay a $530,000 criminal fine and $2.6 million in a civil fines and restitution to the U.S. and state governments. It also is debarred from doing business with government agencies.
The firm, which has revenue of about $6 million, according to a Dun & Bradstreet listing, was founded in 1984 by Vijay Desai.
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Queries to several firm executives were not responded to. The company’s website is dismantled.
The civil settlement arose from a whistleblower’s lawsuit under the False Claims Act.
In a listing as a member of the American Institute of Architects, New York chapter, the firm is described as a certified MBE/DBE contractor.
According to the US Attorney's office, "under pressure from management, employees openly discussed improper billing as 'juicing' and 'tagging' hours in order to 'maximize' bills on government projects and not 'leave money on the table.' One employee summed up his billing practices to his colleague as a 'shell game.' "
According to the AIA listing, VJ Associates has a full time staff of about 70 cost estimators, project managers, schedulers and support personnel and has offices in New York, New Jersey, Massachusetts, Pennsylvania, and Washington DC. It also is cited as a K-12 school project specialist.
