Lawsuits
Wise Services Settles False Claims Act Suit Over MOX Project
A view of the Mixed Oxide Fuel Fabrication (MOX) project while it was still under construction in April 2018.
Photo Courtesy of High Flyer
A subcontractor that prosecutors accused of invoicing for millions of dollars in material that did not exist while it worked on a Dept. of Energy project has agreed to pay more than $300,000 to resolve the allegations against it.
Dayton, Ohio-based Wise Services Inc. knowingly submitted the phony invoices to prime contractor MOX Services LLC, formerly known as CB&I AREVA MOX Services LLC, while working on the Dept. of Energy’s since-canceled Mixed Oxide Fuel Fabrication Facility in Aiken, S.C. between 2008 and 2015, according to Dept. of Justice officials. Subsequently, MOX Services submitted $6.4 million in fraudulent claims to the DOE’s National Nuclear Security Administration, officials alleged in a 2019 civil lawsuit.
Wise Services employees also paid kickbacks to MOX employees to approve the invoices, the suit alleged. The kickbacks totaled $52,000, with items varying from sunglasses to firearms and sports event tickets, ENR previously reported.
The settlement amount of $302,500 “was negotiated based on Wise’s lack of ability to pay,” DOJ officials said in a press release. Additionally, Wise agreed to pay the government 4% of any annual revenues beyond $6 million and 10% of proceeds from the sale of any assets over the next five years.
The settlement agreement notes that Wise denies the claims made in the government’s lawsuit. In a statement provided by Mary Lentz, one of Wise’s attorneys, the company said it was unaware of, did not authorize and did not participate in any false invoice or kickback scheme against the government.
“The United States and Wise agreed to resolve the civil claims with no admission of liability,” the company said in its statement.
MOX settled its case with the government earlier this year, agreeing to pay $10 million.
“The government expects both contractors and subcontractors to adhere to their contractual commitments,” said Brian Boynton, principal deputy assistant attorney general and head of the DOJ’s civil division, in a statement. “Those who violate their commitments and undermine the integrity of the government’s procurement process will face appropriate consequences.”
The Mixed Oxide Fuel Fabrication Facility project was later canceled. As ENR previously reported, the projected cost of the project, with a $4-billion budget, ballooned to $17 billion amid delays and cost overruns. The National Nuclear Security Administration will repurpose the partially built facility, a spokesperson told ENR this year.
