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Contractor allegedly overbilled the City for $1.2 million

Philadelphia, July 18, 2011 – The principal owner of a Haddonfield, NJ-based information-technology firm allegedly defrauded the City of more than $1 million by billing the City for work that had not been performed, announced Inspector General Amy L. Kurland, U.S. Postal Service Inspector-in-Charge Karen Higgins and U.S. Attorney Zane David Memeger.

A federal information alleges that Barry Jones, owner of Mara Management Services Inc. (Mara) and Management and Technology Services Inc. (MTS), violated federal law by inflating the number of hours worked by himself and several of his subcontractors on invoices that he submitted to the City for payment.

From July 2004 to June 2008, Jones knowingly and intentionally submitted false time sheets to City agencies, according to the federal authorities. The Information alleges that Jones repeatedly submitted documents to the Revenue Department claiming that a subcontractor had worked 160 hours per month when Jones knew the subcontractor had only worked 20 hours per month. Jones claimed that another subcontractor had worked 160 hours per month when he knew that the subcontractor had worked between 75 and 115 hours per month. From about 2006 to April 2008, Jones also billed the City monthly for 160 hours of subcontractor work that had not been performed.

In all, Jones is alleged to have fraudulently billed the City for 17,000 subcontractor hours and for hundreds of hours of work he claimed to have performed himself.

The City paid Jones $5.9 million in connection with contracts that Mara and MTS had with the Revenue Department, the Water Department and Community Behavioral Health (a not-for-profit corporation that provides mental health and substance abuse services to Philadelphia County Medicaid recipients on the City’s behalf). Jones himself allegedly pocketed $2.7 million from his contracts with the City.

The federal government is seeking $1.2 million in restitution from Jones on the City’s behalf.

Kurland urged City departments to review all of their contracts for evidence of overbilling and to report any discrepancies to the Inspector General’s Office.