Oracle will pay $200m to settle government beef

ENTERPRISE VENDOR Oracle will pay the US government $199.5m to settle an overbilling dispute.

The company will pay the money to settle allegations that it overbilled government agencies for almost a decade, according to a statement from the Department of Justice (DoJ).

A whistleblower and former Oracle employee, Paul Frascella took the issue to the General Services Administration (GSA), and has been awarded $30m for his troubles.

A lawsuit complains that Oracle tricked the GSA into buying $1.08bn in software in 1998 with a promise of decent discounts and a streamlined process for procurement.

According to the DoJ statement Oracle "knowingly failed to meet its contractual obligations to provide GSA with current, accurate and complete information about its commercial sales practices, including discounts offered to other customers", and "knowingly made false statements to GSA about its sales practices and discounts".

The settlement will put an end to claims that Oracle failed to offer the government proper price reductions such as those given to commercial customers, and forced it to pay over the going rate for its software.

"Companies that in engage in unlawful or fraudulent practices to secure government business undermine the integrity of the procurement process and create an unfair advantage against the majority of companies that are playing by the rules," said Tony West, assistant attorney general for the Civil Division of the Department of Justice.

"Resolutions like this one - the largest GSA false claims settlement in history - demonstrate our commitment to ensure taxpayers are not overpaying for the products and services they receive." µ