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FreshPoint to pay $4.2 million to settle Department of Defense suit

Food distributor FreshPoint Inc. has agreed to pay $4.2 million for overbilling the Department of Defense for produce, the Justice Department said Tuesday.

The Houston company and subsidiary of Sysco Corp. was accused of inflating prices for fruit and vegetables sold to the Department of Defense from Dec. 17, 2007, to Sept. 11, 2009.

The allegations arose after a whistle-blower and former FreshPoint employee, Charles Hall, came forward with a lawsuit under the provisions of the False Claims Act, which allows private individuals to sue on behalf of the government. Hall will receive $798,000 of the $4.2 million settlement, the Justice Department said.

“This settlement demonstrates one of the many types of fraud inflicted upon the American taxpayers,” Edward Tarver, U.S. attorney for the Southern District of Georgia, said in a prepared statement. “The U.S. Attorney’s Office will honor our commitment to vigorously enforce the False Claims Act in order to protect the financial soundness of our nation and its military.”

FreshPoint could not be immediately reached for comment.

The claims settled by the agreement are allegations only, and there has been no determination of liability, the Justice Department said.


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