Cisco, Westcon to Pay $48 Million in Overbilling Case

Cisco Systems Inc., the biggest networking-equipment maker, and Westcon Group North America agreed to pay $48 million to settle claims that they overcharged the U.S. government, the Justice Department said.

The settlement resolves claims that Cisco and Westcon overcharged taxpayers through a General Services Administration contract. The accord settles a lawsuit filed by whistleblowers Norman Rille and Neal Roberts in Little Rock, Arkansas, under the federal False Claims Act.

The Justice Department previously settled claims by the same men over allegations against Hewlett-Packard Co., EMC Corp., International Business Machines Corp., Computer Sciences Corp. and PricewaterhouseCoopers LLP.

“Overcharging the government results in waste of taxpayer dollars,” Brian D. Miller, GSA inspector general, said in a statement. “Our auditors and special agents keep vigilant watch to ensure contractors stay honest.”

The False Claims Act lets private citizens sue on behalf of the government and share in any recovery.

The case is U.S. ex rel. Rille v. PricewaterhouseCoopers LLP, 04-cv-988, U.S. District Court, Eastern District of Arkansas (Little Rock).

To contact the reporter on this story: David Voreacos in Newark, New Jersey, at dvoreacos@bloomberg.net.

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