Verizon has agreed to pay $93.5 million to settle Justice
Department allegations that it overcharged the General Services Administration
for government-wide voice and data services, Justice said Tuesday.
Justice had claimed that Verizon and MCI had charged
federal, state and local taxes in violation of the terms of its contract or
"A government contract is not a blank check," said U.S.
Attorney Ronald C. Machen Jr. in announcing the settlement. "Contractors
who overbill the government will be aggressively pursued and required to make
the taxpayers whole. This $93 million recovery should make contractors realize
that we are firmly committed to ensuring the integrity of corporate billing practices
with respect to government programs."
"Resolving this contract dispute is positive for all parties," said a Verizon spokesman. "We have been successfully performing for GSA under this contract since 1999. The government and Veriozn disagreed on whether certain fees, the majority of fees at issue, could be charged under the contract. The settlement concludes efforts by both parties to resolve this dispute amicably and without further litigation."