CH2M Hill Confesses to Widespread Fraud, Settles with Feds for $18.5 Million; Received $1.3B Stimulus Contract

A politically connected engineering company that received massive stimulus contracts has admitted that workers committed widespread fraud under the encouragement of its executives while working on a major taxpayer-funded nuclear cleanup effort.

Employees of CH2M Hill routinely inflated hours worked on the cleanup effort at the Hanford nuclear waste site in Washington state between 1999 and 2008. Company executives sanctioned those violations in order to obtain bonuses that required certain performance benchmarks, according to an agreement between the company and the Justice Department filed in federal court on Friday.

Subsidiary CH2M Hanford Group Inc. (CHG) agreed to pay $18.5 million to resolve civil and criminal allegations brought by the federal government. The civil charges were initially filed by a company whistleblower.

According to a DOJ press release, CHG “routinely overstated the number of hours they worked, and CHG management condoned the practice and submitted inflated claims to the Department of Energy that included the fraudulently claimed hours.”

Members of CHG’s “upper management” facilitated and encouraged that fraud in order to preserve corporate bonuses that required the company meet certain performance measures, according to the court agreement. The timecard fraud took place between 1999 and 2008 when CH2M was servicing a Department of Energy contract worth $2.2 billion. A different CH2M subsidiary was awarded an additional $1.3 billion in 2009 for the Hanford cleanup.

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