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Military contractor to pay judgment for accepting kickbacks

Posted On: Oct. 19, 2015 12:00 AM CST

Military contractor Kellogg Brown & Root Inc. has been ordered to pay a $108,342 judgment to the United States for accepting gifts and gratuities from subcontractors, said John M. Bales, the Eastern District of Texas U.S. Attorney.

Mr. Bales, who is based in Beaumont, Texas, said in a statement Friday that the Houston-based technology and engineering firm violated provisions of the U.S. Anti-Kickback Act when its employees improperly accepted gifts and gratuities, including expensive dinners, golf outings and event tickets from various subcontractors while KBR was providing logistic services to the U.S. Army Operations Support Command in Iran and Afghanistan.

The statement said final judgment was ordered Oct. 15 by the U.S. District Court in Beaumont following a four-day bench trial in June 2015.

“The business of paying and accepting kickbacks to gain or keep government business is an age-old practice, but it is an obnoxious one and a violation of the trust that companies and individuals should be held to when doing business on behalf of the nation,” said Mr. Bales, in the statement. “The court’s verdict underscores that principal and we commend and celebrate its judgment. The United States Attorney’s office will remain vigilant to detect and to prosecute future violations — there will be zero tolerance for any kickbacks.”

A KBR spokesman could not immediately be reached for comment.

In April, a unit of pharmacy benefits manager Express Scripts Holding Co. agreed to pay $45 million to resolve U.S. claims it participated in a kickback scheme with Novartis A.G. to boost sales of a drug that led to improper government reimbursements.