FTC Settles with Company Claiming Appliances Can Cure Illness
Consumer Protection

The US Federal Trade Commission (FTC) has announced that Oreck Corporation (Oreck) has agreed to “stop making allegedly false and unproven claims that two of its appliances can reduce the risk of flu and other illnesses, and eliminate virtually all common germs and allergens”, and will pay US$750,000 to the FTC as per the settlement (undated). The FTC also alleged that Oreck provided its franchised stores with misleading advertisement to be used to market the two products, the Oreck Halo vacuum and the Oreck ProShield Plus air cleaner, thereby allowing distributors to deceive consumers.
FTC’s media release (7 April 2011)
(Source: FTC)

Healthcare Company Settles Allegations of Medicare Fraud
Business Ethics and Corporate Culture, Financial Integrity, Other

The US Department of Justice (DoJ) has announced that Rex Healthcare has agreed to pay US$1.9 million to resolve a whistleblower action alleging that it submitted false Medicare claims for medically unnecessary minimally-invasive procedures between 2007 and 2009. Additionally, the settlement also encompasses claims relating to “a variety of other minimally-invasive procedures that the hospital classified as inpatient admissions in order to increase its reimbursement when less costly outpatient visits would have been appropriate”.
DoJ’s media release (4 April 2011)
(Source: DoJ)

Company Settles False Claims Allegations Relating to Security Contracts
Financial Integrity, Other

The US Department of Justice (DoJ) has announced that Securitas GmbH Werkschutz has parted with approximately US$9.1 million to settle charges that the company billed the US Army for guards hours not actually worked, under a contract to provide security services at US Army installations in Germany.
DoJ’s media release (5 April 2011)
(Source: DoJ)

Verizon Settles False Claims Charges for US$93.5 Million
Financial Integrity, Government Contracting

The US Department of Justice (DoJ) has announced that Verizon Communications (VC) has paid US$93.5 million to settle false claims charges. It was alleged that VC subsidiary MCI Communications Services invoiced the US General Services Administration “for a variety of federal, state and local taxes and surcharges in violation of the contracts or applicable regulations” in relation to government-wide voice and data telecommunications services contracts, by submitting false reimbursement claims.
DoJ’s media release (5 April 2011)
(Source: DoJ)

Computer Services Company and Auditor Settle Accounting Fraud Action
Business Ethics and Corporate Culture, Financial Integrity

Reuters reports that Satyam Computer Services Ltd (Satyam) (now known as Mahindra Satyam Ltd) has agreed to pay US$10 million to settle US Securities and Exchange Commission (SEC) charges that it “fraudulently inflated revenue, income and cash balances by more than [US]$1 billion over five years”. PricewaterhouseCoopers (PwC) India affiliates will separately pay US$7.5 million for failure to conduct “even the most fundamental audit procedures” in relation to Satyam, reports Reuters. Without admitting to the charges, Satyam has agreed to implement improved training and internal audits, while PwC has agreed not to accept US-based clients for a period of six months, in addition to improving training and audits, according to Reuters.
Reuters: India’s Satyam, PwC settle SEC probes into fraud (5 April 2011)

Related media release:
SEC’s media release (5 April 2011)
(Source: Reuters; SEC)