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Playing defense on fraud

You’d think that an $8.8 billion, eight-year government contract would be enough to keep any business happy, but not Supreme Foodservice GmbH. Company officials padded profits by marking up the cost of food and water being purchased for our troops in Afghanistan and overcharging TRANSCOM, based at Scott Air Force Base, $25 million.

It brought to mind the $600 toilet seats that the Pentagon once got sold. Companies seems to think that if they’re gouging the government, it isn’t really stealing – or at least that they won’t get caught for doing it.

And actually, Supreme Foodservice GmbH might have gotten away with this if it hadn’t been for a whistleblower. Contracting officials were suspicious and questioned some of the charges, but the company always have an excuse to justify the high prices.

Give credit to the Justice Department for vigorously pursuing the case and for negotiating a $434 million settlement of civil and criminal allegations. Fraud is especially damaging now, during a period of shrinking budgets and defense cutbacks. Surviving these challenging fiscal times requires plugging the holes in the budget bucket. Uncovering and stopping fraud and penalizing the wrongdoers are huge parts of the process.