HP Settles Federal Fraud Charges for $16 Million

Lora Bentley

While HP CEO Leo Apotheker is "hiding" from Oracle attorneys, HP attorneys have reached a $16 million settlement with the Federal Communications Commission and the Department of Justice over charges that HP contractors used dinners and other gifts to win contracts.


InformationWeek reports:

The allegations stem from how the contractors competed for money available through the government's E-Rate program, which funds Internet access in schools and libraries ... Through the gifts, the contractors received inside information and won contracts that were supposed to be awarded through a competitive bidding process.

The contracts involved were awarded more than five years ago and included $17 million in HP equipment, the story says. The HP employees involved are no longer with the company. An HP representative said:

HP fully cooperated with the authorities and the matter is now resolved.

The FCC will oversee a compliance agreement that will require regular audits of HP's E-Rate business, the story says.

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