A private British security company with more than 800,000 employees in 90 countries will pay a fine and keep doing business as usual after federal officials alleged that subsidiaries comprising a joint venture violated the False Claims Act by knowingly submitting to the U.S. State Department phony claims for payment.
G4S agreed to pay $500,000 to resolve False Claims allegations after it failed to provide the full 80 hours of training it was contractually obligated to give local guard forces sent to protect the U.S. Embassy in Bratislava, Slovakia.
The companies comprising the joint venture were identified as G4S Secure Integration, LLC; G4S Secure Solutions International Inc.; and G4S Technology Solutions (SK) by South Carolina U.S. Attorney Adair F. Boroughs.
The incident is the latest example of corporate crime being swept under a rug in exchange for cash payoffs, a system that has been strongly criticized by New Jersey Democrat Lisa McCormick.
“The claims resolved by the settlement are only allegations and there has been no determination of liability,” said McCormick, who has advocated a corporate death penalty for businesses that break the law. “It is not even clear that the company is losing any other government contracts.”
McCormick was a candidate for US Senate in New Jersey’s 2018 Democratic primary, challenging Foreign Affairs Committee Chairman Robert Menendez.
She has argued that companies should face greater consequences for criminal activity, including judicial dissolution, also known as the corporate death penalty.
“Slovakia traces its roots to the 9th century state of Great Moravia,” according to the CIA World Factbook. “After the dissolution of the Austro-Hungarian Empire at the close of World War I, the Slovaks joined the Czechs to form Czechoslovakia. In 1993, Czechoslovakia underwent a nonviolent “velvet divorce” into its two national components, Slovakia and the Czech Republic.”
In 1989, the Velvet Revolution peacefully ended the Communist rule in Czechoslovakia and Slovakia became an independent state on January 1, 1993 after the peaceful dissolution of Czechoslovakia, sometimes known as the Velvet Divorce.
While the country has a strategic position in Europe, where it has become an American ally and member of NATO, the security company has a record of screwing up.
G4S failed to provide enough private security guards at the 2012 Summer Olympics to adequately fulfill a £284 million contract—a deal valued at $346 million—causing the United Kingdom to deploy thousands of military personnel at the last moment.
The company also allowed security staff to “cheat” their way through tests aimed at checking to find out whether they could identify dangerous items during training on x-ray scanners.
Recruits were given only 20 minutes’ practice on the machines used to detect explosive devices at the Olympics.
In 2016, G4S Secure Integration, LLC, was awarded a contract by the State Department to provide local guard forces in Bratislava, Slovakia, to provide additional security to the U.S. Embassy.
In the aftermath of the 9/11 attacks, the embassy started building safety blocks and barriers as it adopted enhanced security measures. G4S was hired for services despite the 2012 fiasco.
Two former Belgian employees of another G4S subsidiary, G4S Secure Solutions NV, pleaded guilty on October 18, 2021, to criminal antitrust charges stemming from their involvement in a conspiracy to rig bids, fix prices, and allocate customers for defense-related security services contracts.
Earlier that year, G4S NV pleaded guilty and was sentenced for its involvement in the conspiracy. The Department of Justice also indicted several other members of the conspiracy.
According to court documents, Bart Verbeeck, former Director of Sales, and Robby Van Mele, former Director of Operations, admitted that they, with their co-conspirators at competing firms, colluded to allocate security services contracts and to fix the prices at which the firms bid for contracts.
Those contracts included agreements for guarding, mobile monitoring, and surveillance services with the United States Department of Defense and the North Atlantic Treaty Organization (NATO).
As a result, taxpayers were deprived of a competitive bidding process and paid inflated, non-competitive prices for services.
In the past five years, N4S has secured federal government contracts valued at $319.6 million despite the company’s criminal history and record of incompetence.
Since 1990, N4S has made $702,160 in federal political contributions and it spent $2,770,000 on lobbying since 1998, according to Open Secrets, the nonprofit monitoring the influence of money in politics.
Also in 2018, a 57-year-old Florida inmate died while being transported in a G4S van when the company provided inmate transport services for the Pinellas County Sheriff’s Office.
G4S has also been a large contractor for U.S. Immigration and Customs Enforcement.
In 2018, the American Civil Liberties Union demanded information from ICE over the ways in which it used G4S transport services after a series of detainees alleged they’d been shackled in a windowless van and denied food for hours while in ICE custody.
Outside the US, G4S has been accused of negligent care of detainees, leading to injuries and death.
G4S was forced to repay £108.9 million, equal to $132 million, to the British government in 2014 after overcharging on contracts to electronically tag offenders.
McCormick said that she is opposed to government spending on private armies, for-profit prisons and other money motivated essential services but despite the ideological concerns about undemocratic wasteful expenditures, taxpayers should be better protected from greedy, incompetent criminals.
In October 2021, Allied Universal completed a $5.1 billion takeover of British security firm G4S, creating a combined company of 800,000 employees, with revenues of more than $18 billion. According to Open Secrets, Allied Universal made $431,834 in federal campaign contributions since 1990.
Allied Universal was awarded a security services contracts at government facilities by Bernalillo County, New Mexico; Washoe County, Nevada; Lee County, Florida; among others, even after its AlliedBarton division was required by the U.S. Department of Labor to pay $1.2 million in back wages and interest to resolve alleged discrimination affecting 2,263 female, Black and American Indian employees over a two-year period at the contractor’s New York City location.
“If South Carolina is going to be the first state in the 2024 presidential election then its people should embrace the responsibility of citizenship by becoming more aware of the injustices perpetuated by the officials we select,” said McCormick, a critic of civil settlements and deferred prosecution agreements that she said are used for “white-washing white collar crime.”
“More taxpayer money would be invested in clean energy, health care and the quality of life if voters paid closer attention and if bribery was made strictly illegal,” said McCormick. “Instead, the government does business with criminals and people pay with their lives, enduring unfair hardships or suffering more bitter consequences.”
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