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Dallas-based infrastructure consulting firm AECOM will pay $11.8 million to settle claims it filed false claims to the Federal Emergency Management Agency to build new schools after Hurricane Katrina ravaged Louisiana and the Gulf Coast 18 years ago.
An AECOM project officer deployed to Louisiana after the devastating 2005 Hurricane Katrina allegedly submitted millions of dollars in FEMA claims that increased the price tag of school reconstruction and repair projects. That included “fraudulent requests” for disaster assistance funds for schools such as Xavier University of Louisiana and the Catholic Church.
AECOM moved its headquarters from California to Dallas in 2021.
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Investigators say the AECOM project officer submitted applications, which were eventually approved, to cover complete replacements when only repairs were allowed. After that, AECOM’s supervisors didn’t correct the applications that “included materially false design, damage and replacement eligibility descriptions.”
The company “expressly denies any liability or wrongdoing relating to our work in New Orleans following Hurricane Katrina,” an AECOM spokesman said in a statement. AECOM settled the case to avoid “the expense and distraction of litigation related to events that happened more than 15 years ago.”
“The disputed funds in this case were all allocated for rebuilding New Orleans schools and no funds in question were directed to AECOM,” the company said in a statement. “We continue to disagree with any assertion by any government agency that the schools received too much money to rebuild. After many years of expensive litigation, the government has not secured a verdict or any admission from any of the defendants in this case.”
The U.S. government has already come to $25 million in settlements with other groups connected to AECOM, including Xavier University of Louisiana and the Roman Catholic Archdiocese of New Orleans.
“FEMA plays an essential role in helping communities recover from natural disasters,” said a statement from principal deputy assistant attorney general Brian M. Boynton, head of the Justice Department’s civil division. “Today’s settlement sends a strong message that FEMA contractors, as well as funding recipients, must provide truthful and accurate information so that FEMA’s resources are used to help those truly in need.”
The case was brought by an AECOM whistleblower Robert Romero, who noticed the suspicious claims after being assigned to work in New Orleans in 2010. As part of the settlement, Romero will get more than $2.4 million.
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