HP Settles Kickbacks Case for $55,000,000

The United States Department of Justice has announced that HP has agreed to settle over claims that the computer maker defrauded the U.S. government.

The Department of Justice yesterday announced that HP will pay the government $55 million to settle allegations that it defrauded the General Service Administration by offering systems integrators 'influencer fees' in exchange for recommendations that agencies purchase HP machines.

Also resolved by the settlement are claims that HP's contract with the GSA, signed in 2002, was defectively priced because HP gave the GSA contracting officers incomplete information during negotiations. HP was required to give the GSA information on how it did business in the commercial marketplace so that the GSA could be sure it was getting a good deal. Five years later, in 2007, HP admitted that it may not have abided by all provisions of its contract, prompting an audit which revealed the pricing was off.

"Americans deserve the best deal possible when their hard-earned tax dollars are used," GSA Inspector General Brian Miller is quoted as saying by IDG. "We will aggressively pursue companies that overcharge the government."

The HP suit is part of a bigger kickbacks investigation brought about by a 2004 lawsuit alleging that Sun Microsystems and several Accenture partners, including Cisco Systems, Microsoft, IBM, Dell and Oracle, were all offering or receiving kickbacks.

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