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US brings fraud charges against firm that vetted Snowden

US brings fraud charges against firm that vetted Snowden

By Reuters | Updated: 23 January 2014 22:50 IST

The US Justice Department accused United States Investigations Services (USIS), the largest private provider of security checks for the government, of bilking millions of dollars through improper background verifications.

USIS, which also vetted Edward Snowden before he leaked documents about US spying efforts, has a contract with the U.S. government since 1996 to vet individuals seeking employment with federal agencies. Such background checks include investigative fieldwork on each application.

The Department of Justice (DOJ) said in a court filing on Wednesday that between March 2008 and September 2012, USIS filed at least 665,000 flawed background checks, which was about 40 percent of the total submissions.

A former employee of USIS filed a whistleblower lawsuit in July 2011 under the False Claims Act, which lets people collect rewards for blowing the whistle on fraud against the government.

The lawsuit alleged that USIS failed to perform quality control reviews in connection with its background investigations.

In its filing, the DOJ said USIS submitted background investigations that were not reviewed as per agreed standards.

DOJ said USIS received millions of dollars that it otherwise would not have received had the government been aware that the background investigations had not gone through the quality review process required by the contract.

"USIS management devised and executed a scheme to deliberately circumvent contractually required quality reviews of completed background investigations in order to increase the company's revenues and profits," DOJ said in its filing.

The payments to the firm ranged from $95 to $2,500, depending on the type of background investigation. The lawsuit requested for a jury trial and seeks to recover treble damages and penalties.

Through a software known as "Blue Zone," USIS was able to quickly make an electronic "Review Complete" notation without fully going through the mandated review process, DOJ said.

"The alleged conduct referenced in the civil complaint is contrary to our values and commitment to exceptional service," a USIS spokesperson told Reuters in an email.

The company said the allegations in the complaint related to a small group of people over a specific time period and that it had appointed a new leadership team, enhanced oversight procedures, and improved control protocols.

USIS said it has been cooperating with the government's investigation.

The firm also vetted Aaron Alexis, the technology contractor who killed 12 people at the Washington Navy Yard in September.

The lawsuit is not about the firm's review of Snowden and Alexis.

The case is United States Of America ex rel. Blake Percival vs US Investigations Services, Case No. 11-cv-527, US District Court, Middle District of Alabama (Northern Division).

© Thomson Reuters 2014

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