On Monday, August 28, 2017, United States Attorney Phillip A. Talbert announced that two Bay Area companies and two individuals had agreed to pay roughly $2 million to resolve federal and state False Claims Act allegations. The two companies and the individuals that headed them were accused of knowingly overbilling a program, which was designed to serve California residents with developmental disabilities.
The action comes after a federal lawsuit was filed by whistleblower Beverly McCaffery. The lawsuit contends that Alternative Learning Center, its president Alice Soard, Adult Educational Technologies Inc., and executive director Wendell James defrauded the state’s Department of Developmental Services by billing for services that were not actually provided.
The Department of Developmental Services, DDS, runs a program that gives individuals with developmental disabilities the chance to live within the community instead of being institutionalized. The DDS works with nonprofit centers to ensure in-home support is provided to these individuals. Alternative Learning Center and Adult Educational Technologies Inc. worked in such a capacity.
According to the settlement agreement, the two companies were authorized to provide services in Contra Costa and Alameda counties. The companies were accused of submitting claims for services that were never delivered. The companies were also accused of fraudulently retaining overpayments and falsifying documents.
According to the terms of the settlement, the defendants will be required to make upfront payments to the United States and California, as well as additional payments over a period of time. Alternative Learning Center has agreed to pay a total of $562,600, while Adult Educational Technologies will pay $322,500. Alice Soard will pay $159,400, while Wendell James will pay $107,500. Soard has agreed to sell her primary residence and will give the proceeds to the government.
The whistleblower, Ms. McCaffery, will receive a 20% share of all settlement proceeds paid to the United States.