Military News

Defense contractor fraud uncovered by soldier’s mom

After a robust investigation, this defense contractor reached a settlement of $2.1 million for fraud.
Miguel Ortiz Avatar
LBT is well-known for its 6094 Plate Carrier

On November 28, 2023, the Department of Homeland Security announced a settlement of nearly $2.1 million to be paid by London Bridge Trading Company, Ltd. for the sale of fraudulent products to the U.S. government. Based in Virginia, LBT was investigated by Homeland Security Investigations Norfolk, the Defense Criminal Investigative Service’s Mid-Atlantic field office, the Army’s Criminal Investigation Division’s Major Procurement Fraud field office, the General Services Administration’s Office of Inspector General and the Defense Logistics Agency.

Something’s not quite right here (DHS)

Since at least 2008, LBT made false claims that its products are 100% American-made in compliance with the Buy American Act and Berry Amendment. However, the investigation revealed that many of LBT’s products were actually made in Peru, Mexico and China. Upon their importation into the U.S., the foreign manufacturer’s tags were removed and replaced with “Made in USA” tags. Beyond its government contracts, including those with the Department of Defense, LBT sold these fraudulent products on the GSA Advantage website, where government agencies can purchase from contracted vendors.

Boxes of LBT tactical equipment (DHS)

The DHS announcement notes that the Defense Logistics Agency’s Columbus, Ohio, supply center purchased a variety of textile-based products from LBT. These included clothing, armor, boots, belts, bags, rope, slings, backpacks and medical pouches. The settlement the company was ordered to pay specifically addressed load-out bags violating the Trade Agreements Act and the Berry Amendment. “We greatly appreciate the steadfast, thorough and collaborative work on this case by each of the federal agencies involved,” U.S. Attorney Kenneth L. Parker said in the announcement. “This office takes very seriously the duty of government contractors to meet all of their obligations under government contracts and we will pursue anyone falsely certifying compliance with the Buy American Act.”

An ABU-pattern LBT product with conflicting tags (DHS)

The settlement also resolves a claim made against LBT by an employee of the company under the qui tam provisions of the False Claims Act. They provide for a private party, known as a realtor, to file an action on behalf of the United States. As a result, the realtor is entitled to 15-25% of the government’s recovery. In the case of LBT’s fraud, the realtor had a personal stake; her son was killed in action in Iraq in 2004. She believes that the fraudulent equipment sold by the company posed a threat to the safety of troops who used it.

An LBT 6094 with a Made in Peru sticker (DHS)

“The London Bridge Trading Company deliberately deceived their customers and the U.S. government into believing they were buying American-made products, while selling them cheaper foreign merchandise,” HSI Washington, D.C. Special Agent in Charge Derek W. Gordon said in the announcement. He went on to echo the realtor’s concerns, saying, “LBT potentially put the lives of our military personnel at risk by selling our government inferior protective equipment produced overseas.”

Foreign-made Mechanix gloves are extremely popular in the military (U.S. Marine Corps)

While government purchases must comply with legislation like the Buy American Act, foreign-made products are not necessarily inferior. For example, Mechanix gloves are a mainstay in the U.S. military but are made overseas, largely in China. To that end, LBT offers many of its products under its London Bridge X brand. These products are marked as made overseas but still include the company’s lifetime warranty. However, their origin is presented truthfully and their price reflects this.