Dell Technologies and Iron Bow Technologies have agreed to pay the U.S. government a combined $4.3 million to resolve allegations that they fraudulently inflated prices on technology products sold to the U.S. Army, according to the Department of Justice (DOJ).
Lawsuit Allegations: Inflated Prices and Collusion
The lawsuit accused the two companies of manipulating pricing for computers and other hardware sold to the Army between 2020 and 2024. It alleged that Iron Bow, which resells technology products, received discounts from Dell on hardware but charged the U.S. Army significantly higher prices. At the same time, Dell allegedly offered inflated pricing directly to the Army, creating an illusion of competition while driving up costs.
“This settlement demonstrates the department’s commitment to hold accountable those who overcharge the government through collusion or other unlawful conduct,” said Brian M. Boynton, head of the DOJ Civil Division.
Settlement Terms and Denials of Liability
Under the settlement, Dell agreed to pay $2.3 million, while Iron Bow will pay just over $2 million. Despite the payouts, neither company admitted liability.
Dell issued a statement emphasizing that the settlement was in its best interest, saying, “Dell has entered into a settlement agreement because we believe it is in the best interest of Dell, our customers, and partners.”
Iron Bow, in its settlement document, cited the desire to avoid the prolonged costs and uncertainties of litigation as its reason for settling.
Whistleblower Behind the Case
The lawsuit was originally filed in 2020 under the False Claims Act by Brent Lillard, an executive at another technology firm. The Act allows private citizens to sue on behalf of the government in cases involving suspected fraud.
As part of the resolution, Lillard will receive $345,000 of the $2.3 million paid by Dell for his role in exposing the alleged misconduct.
Implications for Government Procurement
The settlement underscores concerns over pricing transparency and competition in government procurement. Critics say the alleged scheme could have drained valuable resources from the Army, which relies on fair pricing to allocate funds efficiently.
The case also highlights the importance of whistleblowers in uncovering fraudulent practices that affect taxpayers.
