NJ Company To Pay $1.89M To Settle Allegations It Overbilled Feds

EDISON, NJ - A New Jersey-based company is slated to pay $1.89 million to U.S. government as part of a settlement to resolve False Claims Act violation allegations it overbilled the federal government for services never actually performed, officials said.

Blue Water Shipping U.S. Inc. admitted Thursday that an employee of the company, who has since been terminated, created a fake company to bill the federal government for freight services that were never executed, but which were reimbursed by the government, U.S. Attorney Philip R. Sellinger said in a statement. The company is headquartered in Edison, according to public records.

The shipping company already had a contract in which it billed for foreign military sales for freight services, which were reimbursed by the U.S., Sellinger added. The settlement also resolves allegations that Blue Water Shipping charged “unallowable” markups to the U.S. for inland transportation, as well as imports and exports of ocean and air freight.

In conjunction with the investigation, Blue Water Shipping voluntarily disclosed facts to the investigators and cooperated with the investigation and prosecution of the former employee.

Sellinger thanked special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark; special agents of the U.S. Department of Defense, Office of Inspector General, Defense Criminal Investigative Service, Northeast Field Office, under the direction of Special Agent in Charge Patrick Hegarty; and special agents of the United States Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Ricky J. Patel, with the investigation leading to the settlement.