Feeds

Oracle sued for alleged fraud against US gov

'Ten of millions of dollars in overcharges'

Maximizing your infrastructure through virtualization

The US Justice Department has sued Oracle, claiming the software giant overcharged the federal government by "tens of millions of dollars".

The complaint against Oracle was originally filed by an Oracle employee, who alleged that large discounts offered to other customers were hidden from government agencies. Paul Frascella — who no longer works for Oracle — accused his employer of a "scheme...to defraud the United States government by failing to disclose deep discounts offered to commercial customers".

According to court documents filed with the US District Court for the Eastern District of Virginia, Oracle was required — under General Service Administration (GSA) Multiple Award Schedule (MAS) contracts — to offer the government the "best price given to the most favored customer". These MAS contracts allow government agencies to purchase goods from a common catalog without renegotiating with the vendor.

Frascella filed his complaint in May 2007 under the False Claims Act, which allows employees to blow the whistle when they believe their company has defrauded the government, and the Department of Justice joined the complaint in April of this year. When the DoJ joined, the court papers were unsealed.

In 1997, Frascella joined Oracle as a contract specialist in its commercial sales department, and though the company trained him not to offer commercial discounts beyond what was offered to government under "GSA rules", according to the court papers, it later instituted various schemes to avoid these restrictions. Among other things, Frascella alleges, Oracle would sell software to a reseller and the reseller would then sell it to the customer at a price well below the GSA minimum. ®

Seven Steps to Software Security

More from The Register

next story
Whoah! How many Google Play apps want to read your texts?
Google's app permissions far too lax – security firm survey
Chrome browser has been DRAINING PC batteries for YEARS
Google is only now fixing ancient, energy-sapping bug
Do YOU work at Microsoft? Um. Are you SURE about that?
Nokia and marketing types first to get the bullet, says report
Microsoft takes on Chromebook with low-cost Windows laptops
Redmond's chief salesman: We're taking 'hard' decisions
EU dons gloves, pokes Google's deals with Android mobe makers
El Reg cops a squint at investigatory letters
Big Blue Apple: IBM to sell iPads, iPhones to enterprises
iOS/2 gear loaded with apps for big biz ... uh oh BlackBerry
OpenWRT gets native IPv6 slurping in major refresh
Also faster init and a new packages system
Microsoft's anti-bug breakthrough: Wire devs to BRAIN SCANNERS
Clippy: It looks your hands are shaking, are you sure you want to commit this code?
prev story

Whitepapers

Top three mobile application threats
Prevent sensitive data leakage over insecure channels or stolen mobile devices.
The Essential Guide to IT Transformation
ServiceNow discusses three IT transformations that can help CIO's automate IT services to transform IT and the enterprise.
Mobile application security vulnerability report
The alarming realities regarding the sheer number of applications vulnerable to attack, and the most common and easily addressable vulnerability errors.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.