Tuesday, 28 October 2014

Allegations of unethical and illegal behavior by CSC



Allegations of unethical and illegal behavior by CSC

US Government charges CSC, along with New York City, with Medicaid fraud, says Corporate Crime Reporter

Federal prosecutors allege two fraudulent schemes involved CSC and New York City using computer programs to circumvent the requirement that Medicaid should be billed after private insurance coverage had been exhausted. A third fraudulent scheme involved the use of a defaulting to systematically falsify diagnosis codes submitted to Medicaid.
Federal officials alleged that these fraud schemes caused the submission of tens of thousands of false claims to Medicaid and allowed New York City, through CSC, to  improperly to obtain millions of dollars of Medicaid reimbursements.
Full details of the Corporate Crime Reporter article can be found on:  http://www.corporatecrimereporter.com/news/200/computer-sciences-corporation-charged-medicaid-fraud/

After the other allegations of unethical behavior by CSC in the recent past is anyone surprised by this turn of events? Would you buy a used car, sorry, an IT system, from a company with these business practices?

News web sites carrying this piece include:
New York Times: http://www.nytimes.com/2014/10/28/nyregion/new-york-city-agency-and-vendor-csc-bilked-medicaid-us-say.html
CNN: http://money.cnn.com/2014/10/28/news/companies/new-york-medicaid-fraud/index.html
Press TV:  http://www.presstv.ir/detail/2014/10/28/383947/feds-sue-new-york-city-for-medicaid-fraud/
Biz JOurnals:
http://www.bizjournals.com/newyork/blog/techflash/2014/10/feds-accuse-nyc-computer-sciences-corp-of-massive.html

By Littlejohn

42 comments:

Anonymous said...

CSC's employees are overwhelmingly dedicated, ethical and with are people of integrity. A small minority are not, and this small minority is constantly damaging the reputation of the company and by association the reputation of the honest employees, in the eyes of the public. This incident is just another example.

Mike Lawrie is quick to fire managers who miss their quarter's numbers, and to make it known at Analyst conferences that he has has fired them. Will he be equally fast to fire the people responsible for this incident and to make it known to the world he has done so? Or will we get silence and "unavailable for comments". We shall see where Lawrie stands on issues like this.

Anonymous said...

Managers or normal L6-8 employees that are low performers are not necessarily fired at CSC. Those managers might try to get rid of those that are a threat to them first and unfortunately are afraid to actually make termination decision about those that are low performers below them. At the same time a lot of L3-5s spend most of their day not making decisions but minimizing risk exposure by delaying decisions, passing the buck to someone else to make them. Of course they love pointing fingers when something did not work out or claiming fame for the results of others. Finally, when it comes to communication, most perform poorly at sharing information or providing any vision with the one below them. They can't deal with straight talk which was raved about at the global Jam earlier this year. There are exceptional managers that practice a modern management and communication style but unfortunately there are too few within CSC right now.

Anonymous in UK said...

If the right hand of the US Federal Govt is prosecuting CSC for fraud, will the left hand still award contracts to CSC or will this incident have a negative impact on NPS business outlook?

Anonymous said...

I disagree about good people.

The code was no doubt programmed by developers. Project Managers aware. Accounts aware. Service and Account Execs aware. General office admin aware. I doubt was exactly a secret. Anyone report it until recently - NOOOOOOO!!

The "flaw" or should I say functionality not raised by anyone.

Has been happening for years.

Is it a flaw or a feature that kept CSC and the client happy.

I would say this shows the company is rotten from the ground up.

No way can this be fully blamed on management. All the lower level workers easy to blame managers but it is about time they looked at themselves.

I wonder how many other companies supported by CSC have such "features".

CSC needs all customers to audit what they pay!

Anonymous said...

Managerial pathology has once again reared its ugly head. Shameful too because this was one of the successful money making contracts for the company. It's bizarre that on one hand the company stresses the importance of ethics; on the other, the company behavior is anything but. An already damaged company rife with discontented employees bailing for other jobs (and they are out there). The loss of intellectual talent is not something about which the company should trifle.
One wonders if this incident is merely the tip of an iceberg.

Anonymous said...

My only surprise is why this is a surprise to anyone. CSC management is rotten to the core and without ethics, as is well known by those of us on the inside. Senior management lies to each other all the time, misleading on budgets, margins, and facts. There are so many instances of this behavior known, both inside and outside the company, that one more just fails to be news or even interesting.

Ask anyone that has tried to use the "Ethics and Compliance" office - what a joke. A corporate function with the sole purpose of snaring anyone who dares to challenge the politically correct story. If you want to get terminated, open your mouth to these people.

Wake up world - it's all about window dressing the financials in any way possible so Mikey can try to sell this bill of goods before everything crumbles around him.

Anonymous said...

What a brilliant business strategy, defrauding your biggest customer. It takes real management genius to dream that one up.

Anonymous said...

I agree. Ethics & Compliance only really cares if CSC is owed money by a staff member. Any real ethical issues are called HR issues and given to HR who then persecute the person who reported an ethics violation. The department is really only there to help with the SEC violation. As soon as that investigation ends, so will the current power and/or existence of the department. Good riddance in my view.

Anonymous said...

Where/when are the Q2 results? Mikey no doubt worried and the reception he will get given he is copying IBM's play book and we all see how that has been received with its Q2 results.

Anonymous said...

LOL ... and what appears in employees inboxes this morning ... a regular email update from the Ethics & Integrity group.

You just couldnt make it up.

Anonymous said...

Yep, always the foot soldiers that haven't seen a raise in years that are expected to take Ethics training, meanwhile the people at the very top are making off with truckloads of cash.

Anonymous said...

Its always been quite clear that despite the comments from the top addressed to the outside world/wall street that the ethics briefing and policy only applies from layer 5/6 downwards.

Which is crap really, because if there is anything that is going to be a SEC issue, its not going to be a pleb who just decides to come up with that themselves.

Anonymous said...

Well, I may be proved wrong, but the reports look pretty sketchy to me (and the markets seem to take a similar view). I'm always a little dubious of whistleblowers where the US criminal justice system gives them huge bounties for doing what, frankly they should do otherwise - it hardly seems like a system that's ethical itself. And CSC's wrongdoing seems to have been setting defaults up in a certain way, i.e. not that the system itself could not be used approrpaitely, but certain circumstances are assumed - that's typically a client dictated activity. So I remain to be convinced.

Now the delay in reporting the Q2 results I find very interesting ...

Anonymous said...

They will most likely never make it to court, unless they end up filing criminal charges, then I'm sure they will. I've heard that CSC always settles court cases and they rarely go to court....

Anonymous said...

CSC is just like a daytime soap opera. My main complaint is that I'm one of the bit-part extras who relies on the employment. I'm hoping new script writers get involved, and soon!

Anonymous said...

Re 18:15: You think you have problems. I'm just about to get killed off...:-(

Anonymous said...

Try fighting your incorrect GPARS rating. Almost no chance of changing it but instead get terminated in due course.

Anonymous said...

http://www.theregister.co.uk/2014/10/30/danish_court_finds_pirate_bay_cofounder_guilty_of_hacking_csc_servers/

Bbc news as well.. maybe worth a new page.. demark csc seen internally as overpaid work to rule and lazy..

Anonymous said...

"demark csc seen internally as overpaid work to rule and lazy"

Is that a CSC corporate view or a view from somewhere else?

Scandinavian concepts of work vs life are rather different to other places. Personally, I'd prefer my life to be like theirs and not like USA :-(

I don't see them as "lazy" I see them as "lucky"

Anonymous said...

How dare you say this about CSC Denmark!!! You are an ignorant idiot!!! Work hard and earn more yourself!

Anonymous said...

Overpaid? I think the problem is that people is underpaid and that most people with minimal power to grant a raise are cheap bastards that want to please their superiors by not even fighting the right of their subordinates to earn a bit more after having to make the work of three others. Overpaid is Mr Lawrie, not the Danish employees! of course, the idea is that positions must be moved to India just to pay as less as possible. I wish India becomes a powerful nation and that people in India start to be "expensive" (so funny, expensive is paying several millions of $ to the guy who only knows to cut positions) so that we all get a decent salary. Ha! that is called utopia

Anonymous said...

If CSC has been fiddling data in the US, who knows who else has been given falsified data? Some existing customers are starting to ask questions about their own accounts. Rightly so too. Could this be the tip of an iceberg?

Anonymous said...

Thursday Nov 6th http://www.csc.com/newsroom/press_releases/115873-csc_to_report_second_quarter_2015_results_on_thursday_november_6_2014

Anonymous said...

Fiddling like Nero...

Anonymous said...

This is what happens when you create an ethics code that its only purpose is to create marketing PowerPoint slides that are just a stupid and weak CLEARly improvised effort to appear as ethical when you are a shark. Funny thing is that most GPARS evaluations say that employees don't comply with CLEAR values. Cynical crooks! Once I was proud of the company, today I feel assamed even to mention it.

Anonymous said...

Like you I was once proud to work at CSC, But now I feel tainted by what has gone on there. After much good work on many fronts we ripped off the UK Taxpayer with a failed multi-b/milllion pound app and got named and shamed by the British Prime Minister, then an Italian MP raised questions about CSC in the Italian Parliament, in Scandinavia the news of involvement of flights of rendition causes a public furore. then the whole global restructuring where people are fired only after they train their replacements and are arbitrarily down graded now matter how well they performed has been dealt with in an immoral way. To cap it all the Feds are after CSC.
Rather like stone age farmers who did not know any better and used to slash and burn forest to create living space and moved on where they had exhausted the potential of the land CSC seems have slashed and burned its way around the world and has run out of potential. The difference between the stone age and now is that we do know better.
I now never mention in conversation that I was part of the CSC that foisted NHS IT on the UK - it is too embarrassing.

Anonymous said...

When did CSC last win a decent blue company contract?

Anonymous said...

Anyone want to guess what this weeks Q2 numbers call will reveal?

I suspect:

a) Some BS about how Cyber/Cloud/Big Data has grown massively (I guess its easy to get big percentage growth on such rubbish earnings)

b) Internet of Things and Social Media are the NextBigThing(tm) and CSC is going to make a killing on these

c) Strategic Partnerships with Amazon/IBM/Apple/Walmart/KFC/Disney/Somalian Government are going to be mega

d) Lets cut some more jobs

I'll be surprised if anything else is said

Anonymous said...

Here's one for you Cassandra...

Another indicator of LBO to come?

http://www.bizjournals.com/washington/blog/fedbiz_daily/2014/10/csc-offers-former-employees-lump-sum-payout-on.html

Anonymous said...

Just one more attempt to screw over employees.

Anonymous said...

I thought boeing outsourced IT to CSC and both offering it.

This deal is to get people to take the cash and they will lose out in the long run. Corporate greed again.

Decline it.

Anonymous said...

Or do you take the money while it is still there? When the bubble bursts and CSC starts whining in bankruptcy courts about how they deserve to survive at any cost, do the employees take it in the shorts? Or if it turns out the house of cards has yet again fallen on our heads in some way? True, the present value may not be as much as the long term, but on the other hand being the master of your own fate and easily being able to invest in the same instruments that lets CSC hang on to your money can yield the same returns.

Of course this is not for the ultimate benefit of CSC - they want to show they have a reduced future obligation on the books. Just another shot of morphine for the dying patient.

Anonymous said...

The pension plan is insured by the Government. The funds cannot be touched during bankruptcy. Much better to leave it in and get the annuity.

Anonymous said...

So globally "dumping" the balance sheet held the margins up in the Q2 results... I am guessing the "accounting judgement" was pushed to the max hence change of controllers

Anonymous said...

Indeed but focus also remains on maintaining the share price.

Consolidated Condensed Statement of Cash Flows - Six Months Ended Oct 3, 2014

Net Cash provided by Operating Activities $490m
Repurchase of Common Stock $559m

Not sustainable. Current Assets down 10% in the last six months from $5,628m to $5,076m.

A bubble about to burst.

http://www.csc.com/investor_relations/press_releases/116069-csc_delivers_continued_earnings_growth_in_second_quarter_2015


Anonymous said...

This time ML lies are not working... Stock is dropping hard. 1309 is right, the bubble will burst soon. ML already used all his cards: layoffs, stock buys with Bank credits, saving on peanuts (travel,buildings), the illusion of a sale, financial make up... His next step will be to start over and announce more layoffs.

Anonymous said...

Reports have surfaced in recent weeks that CSC, No. 4 on the CRN 2014 Solution Provider 500 list, has been exploring the possibility of a leveraged buyout with private equity firms.

Lawrie and other CSC executives on the earnings call did not address those reports. The closest hint Lawrie gave about the company's long-range plans came when an analyst asked about the possibility of splitting off CSC's North American public sector operations from the company's commercial businesses.

"As I've said many times on these calls, all options are on the table," the CEO said. "We're a public company [and] we're always going to look for the best way to drive shareholder value and continue to serve our customers and employees."

Did he really say employees? more like continue to serve our customers and MY POCKETS!!!

http://www.crn.com/news/channel-programs/300074722/csc-sees-q2-operational-improvement-as-turnaround-continues.htm

Anonymous said...

Redundancy targets in the Uk still haven't been met

Anonymous said...

Revenue dropping..... we all knew this was the case.... harder to cover up by reducing "costs" such as people... buy out... who would want this company now?

Not long now before share goes into free fall into $30-$38 range for trading where it belongs.

More people will be cut, happy Christmas CSC slaves!

http://www.crn.com/news/channel-programs/300074722/csc-sees-q2-operational-improvement-as-turnaround-continues.htm

Anonymous said...

Shouldn't that be Lyring like Nero?

Anonymous said...

Attended the NPS 'Open Mike Mic Session' and couldn't help experience the disconnect between the committee of ML sycophants and the CSC body. Lawrie still committed to Rank and Yank. Lots of corporate speak. Lots of back slapping among the cadre. Much to encourage employees to look for work outside the environs of CSC.

Anonymous said...

Extract from Courthouse News Service of 16 December:

"Computer Sciences Corporation was ordered to pay five former employees more than $350,000 in back wages for work performed in Afghanistan, Iraq and Kuwait, a US federal judge ruled.

The plaintiffs accuse Computer Sciences of denying them overtime wages while working up to 84 hours per week in support of the defense contract in the Middle East between Sept. 2010 and June 2012.

They further allege they were directed to record only 12 hours per day on their electronic time sheets, and if that reported the actual, greater number of hours they worked, supervisors would change those time sheets".

What an ethical company!!!