Grayson Recovers $2 Million for Taxpayers

December 19, 2012

Whistleblower Case Reveals Fraud in Iraq Reconstruction Efforts

Despite an exacting campaign schedule, Representative-Elect Alan Grayson (D-Orlando) successfully recovered $2 million for the taxpayers in a settlement of claims that his whistleblower client, Ian Rycroft, brought against Iraq contractors Haslen Back, Alchemie Group, Ltd., and APTx Vehicle Systems, Ltd. “Whether I am in office or out of office, I will keep fighting to protect the taxpayers from waste, fraud and abuse,” said Grayson.

The case, United States ex rel. Estate of Rycroft v. Zeroline, Ltd. et al., No. 07-cv-10777 (D. Mass.), alleged that the defendants, along with others, violated the False Claims Act by using fake delivery documents to obtain payment for trucks and other equipment that they knew they had not delivered. The trucks and equipment were to have been delivered in Iraq for use in the United States’ reconstruction effort.

Under the settlement, the defendants agreed to pay $2 million to the Government. From that, the Government is paying $540,000 to the Estate of Ian Rycroft. Rycroft died before the case was settled. The Government will keep the rest. Separately, the defendants are paying $208,000 in attorney’s fees. As part of the settlement terms, the defendants do not admit liability. In addition, APTx Vehicle Systems, Ltd. has agreed to plead guilty to conspiracy to commit wire fraud under 18 U.S.C. 1349.

This is the latest Grayson victory against war profiteers. Before he was elected to Congress in 2008, the Wall Street Journal praised Grayson in a front-page story, for waging a “one-man war against contractor fraud in Iraq.” Earlier, Grayson took the first case of Iraq contractor fraud to trial, winning a nearly $12 million judgment for the taxpayers. For his work against war profiteers in Iraq, the national organization Taxpayers Against Fraud named Grayson “Lawyer of the Year.” In 2011, he recovered $8.7 million for the taxpayers in a case against Iraq contractors Dyncorp International LLC and The Sandi Group. The Corporate Crime Reporter called it one of the “Top 100 Corporate Crime Stories of 2011.”

During the 111th Congress, Grayson worked to crack down on defense contractor waste, fraud and abuse. He introduced and passed amendments to reduce “sole source” contracts awarded to contractors without competition, and to have more defense contracts awarded to the lowest bidder.