Booz Allen pays $377.5M over cost accounting

Booz Allen Hamilton Holding Corp. said it will pay $377.5 million under a settlement agreement with the Department of Justice to settle a civil investigation related to its cost accounting.

The case is "one of the largest procurement fraud settlements in history," Principal Deputy Assistant Attorney General Brian Boynton said in a press release. The U.S. alleged that from 2011-2021, Booz Allen improperly charged costs to its government contracts that should have been billed to commercial and international ones. The DOJ was acting for the Defense Contract Management Agency in the matter. 

The agreement contains no admission of liability by the company, Booz Allen said in a filing, noting that it agreed to the settlement "to avoid the delay, uncertainty and expense of protracted litigation." The firm said it had previously recorded a $350 million reserve for possible exposure from the probe.

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During a conference call in May, chief executive officer Horacio Rozanski said the investigation was "into highly technical elements of our cost accounting and indirect cost charging practices with the US government" and that the company "acted lawfully and responsibly."

The probe began in 2017 and the DOJ closed a criminal investigation of the matter in 2021.