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New Jersey company will pay $7.6 million for defrauding government

A Monmouth County, New Jersey, company will pay $7.6 million under a consent decree for its role in making false statements to obtain government contracts that were set aside for businesses owned and controlled by service-disabled veterans, announced today.

As alleged in the government’s complaint, VE Source LLC, based in Shrewsbury, New Jersey; the company’s owners, Sherman Barton and Christopher Neary; and a related entity, Vertical Source LLC, defrauded the federal government by falsely claiming that the company was eligible for government contracts that were set aside for companies owned and controlled by service-disabled veterans.

U.S. Attorney Philip R. Sellinger said VE Source obtained contracts from the U.S. Department of Agriculture (USDA) and the Defense Logistics Agency (DLA), a component of the U.S. Department of Defense, totaling more than $16.5 million.

By obtaining contracts for which they were ineligible, the government alleged that VE Source, Neary, and Barton undercut the express Congressional purpose in enacting laws intended to encourage the awards of federal contracts to businesses owned and controlled by service-disabled veterans.

In the resolution announced today, VE Source agreed to a consent judgment for $7.6 million in conjunction with its role in the scheme.

Sherman Barton

According the company’s website, Sherman is a 12 year veteran of the US Army working in military intelligence with the 66th Military Intelligence Group and the Berlin Brigade.

After his military service, Sherman spent 18 years working for the Veterans Administration coordinating special projects on behalf of disabled veterans. He holds a B.S. from Rutgers University.

The United States entered a separate settlement agreement with Neary, Barton, and Vertical Source, under which Neary will pay $120,000, Barton will pay $75,000, and Vertical Source will pay $180,000 to resolve claims made in a civil lawsuit filed by the United States under the False Claims Act.

The government is represented by Assistant U.S. Attorneys David V. Simunovich and Mark C. Orlowski of the Health Care Fraud Unit in Newark.

The lawsuit resolved through this agreement is captioned United States v. Neary et al., Civil Action No. 20-14167 (D.N.J.). The claims settled by this agreement are allegations only, and there has been no determination of liability.

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