• Consulting Firm Pays $21.5 Million To Settle False Claims Act Allegations Arising From Race And Sex Based Employment Practices

  09/15/2026
  On August 25, 2026, the United States Department of Justice (“DOJ”) announced a $21.5 million settlement with various U.S. affiliated entities of a global tax and consulting firm (“Consulting Firm”) to resolve allegations that the Consulting Firm violated the False Claims Act by knowingly submitting false claims and making false statements to the federal government in connection with race and sex-based employment practices.^[1]

  The DOJ alleged that the Consulting Firm, as a federal contractor, was required to comply with anti-discrimination requirements under Title VII of the Civil Rights Act of 1964.^[2]   According to the DOJ, the Consulting Firm certified compliance with these requirements in its federal contracts while knowingly maintaining practices that discriminated against employees and applicants on the basis of race or sex.  Additionally, the DOJ alleged that the Consulting Firm allocated costs related to these allegedly discriminatory practices to its federal government contracts and sought reimbursement from the government for those costs. 

  The alleged conduct, spanning from January 1, 2017, through the effective date of the settlement, included two principal categories: 

  1. Staffing Decisions: the DOJ alleged that the Consulting Firm took race and sex into account when making hiring, promotion, and staffing decisions to achieve demographic goals.  According to the settlement agreement, business units across the Consulting Firm had certain demographic goals that were tracked on a monthly basis, and the Firm’s Partners, Principals, and Managing Directors compensation could be impacted if their business units did not meet the demographic targets.  
  2. Training and Opportunities: the DOJ alleged that the Consulting Firm offered specific training, mentoring, leadership programs, and other similar opportunities to employees on the basis of race or sex.  For example, the settlement agreement identifies career development programs which offered sponsorships and networking opportunities for certain employees based on race or sex.  

  Under the agreement, the DOJ reserved several categories of claims, including any currently pending or future charges filed with the Equal Employment Opportunity Commission.  Notably, the settlement agreement is neither an admission of liability by the Consulting Firm nor a concession by the United States that its claims lack merit, and the Consulting Firm expressly denies that it engaged in the alleged conduct and denies the allegations in the civil action.  Additionally, the agreement notes that the Consulting Firm received cooperation credit. 

  The settlement agreement was secured under the DOJ’s “Civil Rights Fraud Initiative,” which was established in May 2025.^[3] This settlement with the Consulting Firm follows the Department’s first Civil Rights Fraud Initiative resolution which it secured with another global firm in April of this year ^[4],  signaling the Department’s continued prioritization of bringing actions under the False Claims Act.  Attorney General Todd Blanche said in a statement that “The Justice Department will aggressively pursue government contractors that have used taxpayer dollars to fund unlawful discrimination[,]” which includes practices that reward employees based on race or sex.

  Companies that hold federal contractor agreements with the government should carefully evaluate their internal policies and employee programs.  Those that fail to treat their employees without regard to race or sex risk having these same claims brought against them, from both the DOJ and private citizens or entities. 

   

  [1] https://www.justice.gov/opa/pr/deloitte-agrees-pay-215m-resolve-alleged-employment-discrimination-violations

  [2] https://www.justice.gov/opa/media/1459061/dl

  [3] https://www.justice.gov/opa/pr/justice-department-establishes-civil-rights-fraud-initiative

  [4] https://www.justice.gov/opa/pr/ibm-pays-17-million-resolve-allegations-discrimination-through-illegal-dei-practices

  Categories: Civil Enforcement,  DOJ
  

Links & Downloads

• JUSTICE DEPARTMENT ESTABLISHES CIVIL RIGHTS FRAUD INITIATIVE
  
• IBM PAYS $17 MILLION TO RESOLVE ALLEGATIONS OF DISCRIMINATION THROUGH ILLEGAL DEI PRACTICES
  
• DELOITTE AGREES TO PAY $21.5M TO RESOLVE ALLEGED EMPLOYMENT DISCRIMINATION VIOLATIONS
  
• DELOITTE SETTLEMENT AGREEMENT EXECUTED 08/21/2026