According to the U.S. Department of Justice (DOJ), PricewaterhouseCoopers (PwC) has agreed to settle allegations that they defrauded the government by overcharging for travel expenses over 11 years. The payment of $41.9 million settles a whistle-blower lawsuit initiated against the world's largest accounting firm in 2001. In a statement to the Associated Press, PwC spokesman David Nestor said the firm admitted no criminal misconduct in settling with the government.
âWe're pleased to have resolved this matter with the federal government,â Nestor said in a statement to the Associated Press.
The charges stem from the failure to consistently disclose rebates received from airlines, credit card companies, hotels, car rental agencies, and other travel-related businesses in the execution of their government contracts. In some cases, PwC charged the government for the full amount of travel expenses without discounting the amount of rebates taken.
"[PwC] knowingly presented claims for payment to the United States for amounts greater than the travel expenses actually incurred and in violation of contractual provisionsâ¦,â the U.S. Justice Department said in a statement to Reuters.
âThe federal government relies on the honesty of its contractors to provide accurate billing information,â Assistant Attorney General Peter Keisler said in a statement to the Associated Press.
âThe firm's former policy that gave rise to this matter was changed in 2001 before we were aware of any government investigation,â Nestor said in a statement to Reuters.
PwC recently settled its share of a 2003 class action law suit for $54.5 million where the firm was accused of overbilling corporate clients.
Both these settlements are proper steps in changing the image of the accounting industry that has been marked with several very public accounting scandals over the last three years. Although self-regulated in the past, the accounting industry seems to regaining its image and integrity via increased government oversight and tighter policies and standards.