CT-based Otis Elevator agrees to pay $616K to resolve False Claims Act allegation in Tennessee
Otis Elevator Company has agreed to pay more than $500,000 to resolve allegations tied to the False Claims Act.
The settlement was announced Friday by the U.S. Attorney's Office for the Eastern District of Tennessee. Under the terms of the settlement, Otis will pay the government $616,987, federal officials said.
Otis, which is headquartered in Farmington, agreed to the settlement to resolve allegations related to invoices for preventive maintenance services submitted to the Tennessee Valley Authority 'that were not rendered pursuant to the terms of a contract,' federal authorities said.
'A contractor, like Otis, has an obligation to submit invoices and seek reimbursement solely for work and services that have been performed as claimed,' U.S. Attorney Francis M. Hamilton III for the Eastern District of Tennessee said in a statement. 'This settlement with Otis demonstrates that the United States Attorney's Office and federal partners like TVA's Office of the Inspector General are using all tools available to address fraud, waste and abuse and protect public funds.'
The investigation focused on an August 2017 contract between Otis and TVA. Authorities contend that the contract required Otis to provide turnkey modernization and specified monthly preventative maintenance services related to certain elevators in the TVA Knoxville Office Complex. Federal officials said 'certain civil claims' against Otis arose from its performance of the contract.
'Specifically, the United States contended that Otis submitted false claims for payment to TVA for preventive maintenance services that were not rendered,' the U.S. Attorney's Office wrote in a statement
The settlement was the result of a coordinated effort between the U.S. Attorney's Office and the TVA Office of the Inspector General – Office of Investigations (TVA-OIG).
'The TVA Office of the Inspector General is committed to identifying and investigating instances where vendors fail to fulfill contractual obligations as well as false claims and overpayments that negatively impact ratepayers throughout the Tennessee Valley. We would like to thank the United States Attorney's Office for their dedicated support of such efforts,' Assistant Inspector General, Investigations D. Eric Beals of the Tennessee Valley Authority Office of Inspector General, said in a statement.
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