Former U.S. Marine officer Sarah Feinberg, who had multiple combat tours in Iraq, became a whistleblower after uncovering a massive civil fraud scheme at Booz Allen Hamilton. The consulting firm recently agreed to pay a $377 million settlement while admitting no wrongdoing. This marks the third-largest contract fraud settlement in U.S. history, according to the Department of Justice (DOJ).
After returning from Iraq and completing an MBA from the Wharton School, Feinberg joined Booz Allen Hamilton, a company with annual contracts valued at $6.5 billion. She was tasked with tracking internal financial data. It was then that she discovered the company was allegedly overcharging U.S. taxpayers to subsidize its loss-making private consulting contracts, including those with foreign governments like Saudi Arabia.
Battle Inside Booz Allen
Feinberg tried for nine months to convince Booz Allen executives to address what she believed was blatant fraud. Ignored and sidelined, she finally chose to resign while pregnant with twins. After stepping down, she used the "qui tam" procedure under the False Claims Act, which allows an insider to sue on behalf of the U.S. government and recover a percentage of the settlement.
Because Feinberg discovered the alleged fraud and filed a complaint, she and her legal team received a staggering $69 million from the $377 million settlement. "I've got three kids, and I tell them, 'Doing the right thing is the right thing, no matter what the outcome is,'" said Feinberg, who plans to give away at least $12 million of her share to charity.
For Feinberg, the fight isn't entirely over. She believes the settlement amount should have been higher, given that she argues in her lawsuit that the firm overcharged taxpayers by at least $500 million. Post-settlement, Booz Allen's stock price even surged by 20%, adding insult to injury.
Justice Department officials said they secured the best settlement possible, and Booz Allen, in its statement, maintained that it has "always believed it acted lawfully and responsibly. The firm also noted that a separate criminal inquiry and Securities and Exchange Commission investigation were closed without action.
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Community Support
Feinberg said she has received numerous messages from current and former Booz Allen employees praising her courage. Her actions also sparked a conversation on the ethical responsibilities of corporations, particularly those involved in government contracts.
Feinberg credits her time in the Marine Corps for giving her the moral compass to take such a strong stand. "It helped me get a sense of right versus wrong and to have a clear picture of the service that I wanted to perform for our country," she said.
Feinberg doesn't see her life changing dramatically despite the massive settlement. A runner and mother of three, she plans to continue her charitable work and stay in her current Northern Virginia home with her husband, who runs an anti-poverty nonprofit. They have plans for a lake house and a trip to Italy, but Feinberg says, "I'm going to give a lot of it to charity and to causes I believe in."
This case serves as a watershed moment for corporate ethics and a powerful testament to the impact of individual courage in the face of institutional malpractice.
