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US settles fraud case with company behind Snowden's background check

US settles fraud case with company behind Snowden's background check

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The Department of Justice has settled a case against the background check company that vetted Edward Snowden and Washington Navy Yard shooter Aaron Alexis. US Investigations Services (USIS), which was accused of circumventing the review process for many of its reports, agreed to forfeit at least $30 million in outstanding payments from the US Office of Personnel Management (OPM). In exchange, the Justice Department will drop a suit it filed in early 2014 under the False Claims Act.

USIS was founded in 1996 as a privatized version of the OPM's background check service, handling large numbers of investigations for federal agencies like the Department of Homeland Security. But a former employee claimed that starting in 2008, it had used software to submit checks without going through a required quality review, a process it allegedly called "dumping" or "flushing."

USIS' government contracts were dropped last year

The Justice Department filed formal charges against USIS in early 2014, saying that the company had submitted 665,000 unreviewed background checks — or roughly 40 percent of its submissions between 2008 and 2012. The case didn't specifically accuse USIS of improperly handling Snowden's or Alexis' background checks, although it raised questions about the overall quality of the reviews.

At the time, USIS said that the allegations "relate to a small group of individuals over a specific period of time and are inconsistent with the strong service record we have earned." But the OPM dropped its contracts with USIS in late 2014, shortly after the company was targeted by a large-scale hack. Its parent company Altegrity filed for bankruptcy in February.