Common contracting fraud schemes
Federal contractors must meet precise specifications — from highway materials testing to cybersecurity certifications on defense systems. Fraud includes substituting substandard materials, falsifying test results, inflating labor hours, cross-charging costs between contracts, and misrepresenting small-business or veteran-owned status.
Why insiders matter
Auditors rarely see what happens on a job site or in a manufacturing line. Quality assurance staff, project managers, and subcontractors often hold the key facts. False Claims Act cases in construction and defense have returned hundreds of millions to the Treasury.
Materiality and certification
Many contracts require periodic certifications of compliance. Submitting a claim for payment while knowingly failing to meet contract requirements can be false under the FCA. The government does not need to prove every penny was lost — material false statements tied to payment requests are enough for enforcement to begin.
Next steps for whistleblowers
If you have firsthand knowledge of fraud on a federal contract, preserve evidence lawfully and speak with qui tam counsel. First-to-file and public disclosure rules apply, so delay can cost you the ability to bring a case.