Tuesday, August 28, 2007

It's the Shipping Costs That Will Get You

Remember those $400 dollar hammers and $600 toilet seats? That was nothing. C&D Distributors was (is?) a small defense contractor of small parts, things like washers and screws. It was founded by twin sisters Darlene and Charlene Corley. "The company used a government system that fast-tracked items to priority military installations. C&D submitted the shipping costs separately and the system paid them automatically." Except, they exploited this as described by the Washington Post, Defense Contractor Was Paid $1 Million to Ship 2 Washers.

"Among the invoices was a 2004 order for a single $8.75 elbow pipe that was shipped for $445,640, according to the documents. Also that year, a $10.99 machine thread plug was shipped for $492,096. Last year, six machine screws worth a total of $59.94 were shipped at a cost of $403,436. The Pentagon paid 112 of the fraudulent invoices until the scheme was detected last September." Darlene committed suicide in October "after being approached by federal investigators".

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