The Department of Justice announced a $21.5 million settlement with five Deloitte entities to resolve allegations under the False Claims Act, the federal statute that penalizes companies for submitting false claims for government money. Notably, the DOJ alleged that the companies’ employment practices violated Title VII and the standard equal opportunity clause found in federal contracts, and that billing the government while out of compliance amounted to a false claim. The case is the second settlement secured under DOJ’s Civil Rights Fraud Initiative, a cross-agency enforcement push that pairs the False Claims Act with other tools such as the Equal Credit Opportunity Act. For startups, the relevant exposure is real: companies that sell to federal agencies and their subcontractors are bound by the equal opportunity clause, Title VII and the compliance obligations that come with them.
