US recovers more than $2 million from Pakistan-based firm in fraud probe

New Delhi: A Pakistan-based company has been ordered to repay more than $2 million after allegedly fraudulently obtaining U.S. federal grants meant to support businesses operating in economically disadvantaged American communities, according to federal authorities.

The case is among the first major actions highlighted by the newly created Fraud and Asset Recovery Division in the U.S. Attorney's Office for the District of Columbia, according to the local ABC affiliate for the greater Washington DC area WJLA report.

U.S. Attorney Jeanine Pirro described the matter as an example of the type of civil fraud her office is targeting and warned that similar cases could emerge in the future, the report said.

According to Pirro, Enterprise Technology Solutions (ETS) secured two grants from the Small Business Administration (SBA) under a programme designed to assist businesses located in underserved communities.

The company allegedly represented that its headquarters were located in College Park and that at least half of its workforce lived in the surrounding area, the report noted.

However, federal authorities contended that the firm's principal operations were actually based in Pakistan, making it ineligible for benefits intended for U.S.-based businesses and workers.

Pirro said the grants were funded by American taxpayers and were intended to support economic development within the United States. She described the company's conduct as a scheme that diverted funds away from their intended purpose.

Because the matter was pursued as a civil fraud case, no criminal charges were filed and no prison sentences are involved. Instead, the company has been required to repay more than $2 million to the federal government, the report said.

The U.S. Attorney's Office is also encouraging whistleblowers to come forward with information about suspected fraud involving federal funds.

Individuals who provide information leading to successful recoveries may be eligible for a share of the recovered money under applicable whistleblower provisions.

In the case involving Enterprise Technology Solutions, authorities said the whistleblower's share amounts to more than $330,000, reflecting a portion of the funds recovered by the government, as per the report.

ABOUT THE AUTHOR

IANS

[email protected]