Cisco and Westcon agree $48m settlement

Cisco and Westcon have agreed to pay the US government $48m

Cisco and its distributor Westcon have agreed to pay the US government a $48m fee to settle claims they misled federal agencies during contract negotiations.

According to a statement released by the US Justice Department, the settlement revolves around accusations that both firms provided incomplete information to the General Services Administration (GSA).

It is alleged that these actions led to “defective pricing” and the “submission of false claims” to the US government, actions that breach several pieces of US legislation.

These include the Federal Acquisition Regulations, which require that vendors provide current and best pricing data when negotiating contracts with government departments.

Tony West, assistant attorney general for the civil division of the Department of Justice, said: “Contractors that do business with the United States must deal fairly with federal agencies.

“When contractors provide incomplete and untruthful information to the government, we will take action to restore the integrity of the procurement process and protect taxpayers’ dollars.”

As part of the settlement, the government agreed to dismiss a lawsuit filed in 2004 against Cisco relating to claims the vendor gave kickbacks to systems integrators working on government contracts in exchange for preferential treatment.

In a report on Reuters, Cisco claims the settlement involved a “small fraction” of sales between 1997 and 2009 and that it was pleased to have the matter resolved.

Cisco spokesperson Kristin Carvell said: "Cisco and Westcon have been working with the Department of Justice on this issue for years, and we are very pleased to resolve this matter."