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'Big Dig' Consultants to Pay $407M Over Alleged Fraud

Two companies involved in the design and construction of Boston's "Big Dig" underground-highway project will pay $407 million to resolve allegations that they charged the government for faulty work.

The U.S. government and Massachusetts officials began investigating Bechtel Infrastructure Corp. and Parsons Brinckerhoff after defects appeared in a tunnel wall in September 2004.

State Attorney General Martha Coakley's office opened a criminal investigation after a tunnel ceiling collapsed July 11, 2006, killing a passing motorist.

Bechtel and Parsons Brinckerhoff served as management consultants responsible for overseeing the design and construction of the Big Dig, which began in 1985 and is still underway, according to a statement by Coakley.

The Massachusetts Turnpike Authority is in charge of the project, which is funded by the federal government.

The MTA ended its contract with Bechtel and Parsons Brinckerhoff in late 2007, according to news reports.

The federal government and the state joined with whistle-blower Daniel Johnston in suing the companies in 2006 in the U.S. District Court for the District of Massachusetts.

The suit alleged that Bechtel and Parsons Brinckerhoff violated the federal False Claims Act and the parallel state law by charging for faulty work on the project.

The suit said the companies did not provide adequate services in connection with managing the construction of tunnel wall panels or the installation and monitoring of bolts in the tunnel ceiling.

The plaintiffs also said the companies did not ensure that the concrete used in the job met contract specifications or check the accuracy of the records used to determine payments for suppliers and contractors.

Under the terms of the deal, Bechtel and Parsons Brinckerhoff will pay a total of $407 million to end both investigations and the lawsuit.

Bechtel will pay $357.1 million and Parsons Brinckerhoff will pay $50 million, according to Coakley.

In a related settlement involving the project, several unidentified design consulting companies that worked with Bechtel and Parsons Brinckerhoff have agreed to pay the state a total of $51 million as compensation for their allegedly faulty work.

Coakley said that most of the $458 million obtained through all the settlements will be held in a trust fund to cover the cost of repairs and maintenance on the Big Dig project.

Johnson will receive $150,000 of the settlement money paid by Bechtel and Parsons Brinckerhoff pursuant to the False Claims Act, which allows whistle-blowers to share in any recovery the government obtains.

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