J.M. Waller Associates: Engineering and Inspection Bills

In the J.M. Waller Air Force settlement, J.M. Waller Associates agreed to pay $229,060 to resolve allegations of improper engineering and inspection billing. The government alleged that the company used inappropriate labor categories and rates, billed inspection days without construction, and charged work to a task order that did not cover it. Someone who knows the work behind those charges can see a discrepancy that the invoice alone may conceal.

The Fairfax, Virginia company held a professional-services contract for design architect-engineering and inspection services on construction projects at Joint Base Pearl Harbor-Hickam in Honolulu. According to the Justice Department’s settlement announcement, the disputed claims covered October 1, 2008, through November 30, 2010. The case brings defense contractor labor fraud down to the project level: the task assigned, the service billed and the work actually performed.

What J.M. Waller Allegedly Billed

The government described three ways the company’s payment claims allegedly departed from the work the Air Force had contracted to buy. Each turns on a different part of the bill, so knowing whether an employee worked that day answers only part of the question.

Labor Categories and Billing Rates

The first allegation concerned inappropriate labor categories and billing rates for particular tasks. A category assigns a description to the labor being sold to the government, and the rate puts a price on it. The work assignment and the category used on the bill therefore have to be read together.

Time-and-materials contracting shows why those descriptions matter financially. Under the federal rules for that payment arrangement, qualifying labor hours carry fixed category rates that include wages, overhead and profit. The broader issue of labor qualifications and billed categories connects what the contract buys to what the contractor supplies. In Waller’s case, the government specifically challenged the categories and rates used for certain tasks.

Inspection Days Without Construction

The second allegation was more concrete: Waller allegedly billed inspection services on days when no construction had been performed. We see more than a billing label in that allegation: the government was charged for inspecting construction without the construction.

For an inspector or project scheduler, the connection is immediate. A construction record can show what happened at the site on the date attached to an inspection charge, while an inspection record can show what service the contractor says it supplied. Read alongside the contract’s inspection requirements and the submitted bill, those records connect the claimed service to the project. That is the work-to-payment comparison we would examine with someone who knows the site.

Work Charged Outside a Task Order

The third allegation concerned time billed to a particular task order for work outside that order’s scope. This is the cost-mischarging question within the case: which authorized work was the Air Force being asked to fund? A time entry identifies hours, but the task-order scope identifies the work those hours were supposed to serve.

The distinction has a direct counterpart in federal cost-allowability rules, which require support showing that claimed costs were incurred and belong to the contract. A project assignment, a time record and the task order named on the bill address different parts of that connection. For someone administering several projects, the crucial detail may be where the work was charged compared with the project it actually served.

The authorized scope can also change through contract modifications. That makes the version of the task order covering the billed work part of the comparison, alongside the assignment and time record.

How the Air Force Found the Billing Discrepancies

The Air Force contracting office identified billing discrepancies while processing Waller’s claims, prompting the civil investigation. The Air Force Office of Special Investigations conducted it, reviewing thousands of pages of documents and interviewing witnesses. Defense Contract Audit Agency auditors and Air Force contracting officers supplied expertise and support. The person processing a claim and the person who knows what happened on a construction site can see different parts of the same charge. The Justice Department announced the False Claims Act settlement on February 7, 2014.

The Engineering-Billing Pattern in Another Case

CDI Corporation agreed to a $1.95 million settlement over alleged false engineering labor charges on military aircraft-engine work. In its November 24, 2010 announcement, the Justice Department described allegations that CDI’s Sharonville office directed false labor allocations to military-engine purchase orders under General Electric subcontracts. Charges in increments of half an hour or less allegedly concealed work never performed on those projects.

A former CDI employee brought that case. Its relevance here is the connection between labor recorded and the project billed: an entry can look small and ordinary while charging the government for work it never received. Waller’s task-order allegation likewise directs attention to the job behind the time entry.

What Proof Do You Need as a Whistleblower?

The useful proof connects what the government was billed to the work actually done and the contract terms behind the charge. Labor-category assignments, work records, inspection dates, task-order scope and payment claims answer different parts of that question. We work with you to identify where your knowledge connects them.

An engineer may understand the task that was assigned. An inspector may know the construction activity behind a claimed inspection day. A timekeeper or billing employee may see which category or task order received the hours. Those perspectives are useful because the same invoice can carry a question about the rate, the service and the project charged.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. If your concern starts with an inspection charge or a task-order assignment, our whistleblower experts can assess how that specific discrepancy connects to the government’s bill and the decisions behind it.

You Know the Work Behind the Bill

If the category, inspection day or task order on a government bill contradicts the work you know, talk with our whistleblower experts. We build the case with you and bring in defense contractor whistleblower lawyers who understand engineering-services billing and procurement records. We stay beside you as your account of the work becomes a case for recovering the government’s money.