R&K Enterprises Inc., a company based in Newport News, Virginia, has agreed to pay over $2.6 million to settle allegations under the False Claims Act and common law. The company was accused of falsely claiming eligibility for small business set-aside contracts despite not meeting the necessary criteria.

The United States alleged that R&K misrepresented its size standard qualifications for the General Services Administration’s One Acquisition Solution for Integrated Services Small Business Pool 1 Contract. It was claimed that R&K transferred a contract to K&P Management Inc., another company, and falsely stated that the two were not affiliated. Allegations included shared executives and control by R&K over K&P, whose revenue came entirely from R&K. Consequently, it was argued that K&P's revenue should have been considered in R&K's size calculations.

U.S. Attorney Jessica D. Aber emphasized her office's dedication to preventing exploitation of programs designed to maintain competition for contracts: “My office is committed to identifying, investigating and eradicating attempts to exploit programs intended to protect competition for contracts.”

Principal Deputy Assistant Attorney General Brian M. Boynton noted the importance of these contracts for small businesses: “Small business set-aside contracts assist small businesses to compete,” he said. “When ineligible companies fraudulently obtain contracts reserved for small businesses, they prevent the small business community from receiving the contracting opportunities that Congress intended.”

Deputy Inspector General Robert C. Erickson of the GSA highlighted collaboration with law enforcement in tackling such fraud: “We will work with law enforcement partners to investigate allegations of small business fraud, including companies that misrepresent their status to get federal contracts.”

The settlement resulted from a joint effort involving several agencies including the U.S. Attorney’s Office for the Eastern District of Virginia and various divisions within the Justice Department.

Assistant U.S. Attorney Clare Wuerker and Trial Attorney Danielle Rowan led investigations into this matter.

It is important to note that these resolved claims are merely allegations; no liability has been determined.