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Oracle is in trouble with the US government

Feds take over whistleblower's case
Fri Jul 30 2010, 10:48

FULL SERVICE COMPUTER FIRM Oracle is in hot water with the US government over a General Services Administration (GSA) software contract.

The contract was in effect from 1998 to 2006 and involved hundreds of millions of dollars in sales. The US government has filed a complaint under the False Claims Act, claiming that the outfit defrauded the public.

Under the contract, the GSA used Oracle's disclosures about its commercial sales practices to negotiate the minimum discounts for government agencies that bought Oracle software.

Oracle was supposed to tell the GSA about all the discounts it offered everyone else and give it the same deals.

Apparently Oracle forgot and allegedly "misrepresented" its real commercial sales practices. The result was that the government was disadvantaged and got deals far inferior to those Oracle gave commercial customers.

Originally the case was filed by Paul Frascella, Senior Director of Contract Services at Oracle.

The False Claims Act allows private citizens with knowledge of fraud to file whistleblower suits on behalf of the United States and get a cut of the proceeds.

If the government takes the case over then the whistleblower still gets a lot of dosh if the claim is successful but does not have to take on the legal might of the company accused of fraud.

It was fairly likely that the government was going to take the case. An investigation has allegedly turned up enough evidence to prove the claim. µ




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