⏱ 2 min read
Somewhere between July 2019 and June 2020, a brazen conflict of interest played out in the halls of the Department of War and the offices of Sierra Nevada Company, LLC (SNC), a defense contractor headquartered in Sparks, Nevada. Michael Henry, a Department of War employee, simultaneously worked as a consultant for SNC, participating personally and substantially in three government contracts awarded to the company. The contracts, awarded by the Army, General Services Administration, and Special Operations Command, raised eyebrows due to Henry’s dual role.
As a Joint Staff/J6 employee, Henry evaluated and obtained approvals for SNC’s products, while also recommending them for purchase on behalf of the company. This blatant organizational conflict of interest led to allegations that SNC submitted or caused the submission of false claims, false statements, and false certifications in connection with the contracts. The United States alleged that SNC knowingly made material false statements and certifications, omitting the fact that an organizational conflict of interest existed.
The fallout from this scheme has resulted in SNC agreeing to pay $7.75 million to settle the False Claims Act allegations. The settlement resolves claims that the company’s employment of Henry and his participation in the contracts on SNC’s behalf constituted a serious conflict of interest under the Federal Acquisition Regulation.
The investigation, likely involving the FBI and other agencies, has brought to light the corrupt practices of a major defense contractor. The $7.75 million settlement serves as a warning to companies that engage in such behavior, putting profits over propriety and integrity.
📋 Key Facts
- Crime: Fraud & Financial Crimes
- Defendant: Virginia
- Location: VA
- Source: DOJ Press Release
