Justice Forces Phony Woman-Owned Contractor to Pay $20 Million

The defense contractor UFC Aerospace and its former president agreed to pay $20 million after admitting to the government that the company had falsely certified itself as a woman-owned small business, the Justice Department announced on Thursday.

Beginning in 2001 until 2011, the Bay Shore, N.Y-based firm and its former president Douglas Davis engaged in civil fraud “in order to secure numerous lucrative defense subcontracts with government contractors,” said a release from the U.S. attorney’s office for New York’s Southern District in Manhattan. UFC “falsely certified to government contractors that UFC was a woman-owned small business (“WOSB”) when UFC at no point met either requirement for WOSB status under the Small Business Act,” it said in announcing that a district judge had approved the settlement.

In fact, the government said, no women were majority owners of UFC or managed or controlled UFC’s management and daily business operations and hence would not qualify for the contract set-asides. The subcontractor made these misrepresentations in the belief it would gain a competitive advantage, “and the government contractors in turn made representations to the government regarding its WOSB hiring, the announcement said.

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