Tuesday, July 09, 2013
Document Shredding Companies to Pay $1.1 Million
Iron Mountain Corporation and Shred-It USA, two of the largest document shredding companies in the nation, have agreed to pay $1.1 million to settle allegations that they knowingly failed to meet the requirements of their federal contracts. According to the allegations, Iron Mountain Corporation, Shred-It USA, and non-settling co-defendant Cintas Corporation insufficiently shredded sensitive government documents. Under the contract, documents had to be shredded into pieces no larger than 1/32nd of an inch by 1/2 an inch, but in some instances the companies were allegedly using equipment that created pieces 100 times that size.
The qui tam lawsuit was initiated by the owner of a small shredding business that attempted to compete with the three large companies, but was rejected from federal contracts because its equipment was unable to perform to government requirements--the same requirements the three companies failed to meet. Knowing, based on his experience in the industry, that Iron Mountain Corporation, Shred-It USA, and Cintas Corporation’s trucks were also incapable of meeting government requirements, the owner filed a whistleblower False Claims Act case against those companies. The owner of the small business will receive a portion of the amount recovered by the government as a reward for bringing the fraud to the government’s attention.
Read the entire article, “Iron Mountain and Shred-It Pay $1.1 Million to Resolve False Claims Act Charge"
Posted by eithurburn on 07/09 at 03:43 PM
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