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Agrees to cough up $4.5 million compensation

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Compaq has agreed to pay $4.5 million to settle charges that Digital - acquired by big Q in 1998 - overcharged the US Defense Department for work done back in 1995, reports Reuters.

Digital admitted that it had inflated labour charges on work done on projects in Florida and Frankfurt, but a US Justice Department investigation uncovered further irregularities such as the conversion of hardware costs into man hours and some, erm, 'creative' travel expenses.

"Cases like this demonstrate the Justice Department's continuing commitment to ensuring that the government contractors do not over charge the United States on goods or services," said David Ogden, acting assistant attorney general for the agency's civil division.

Compaq had made no statement at press time. ®

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