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U.S. joins lawsuit against firm that vetted Snowden

A demonstrator wears a T-shirt depicting former U.S. spy agency contractor Edward Snowden at the "Stop Watching Us: A Rally Against Mass Sur
A demonstrator wears a T-shirt depicting former U.S. spy agency contractor Edward Snowden at the "Stop Watching Us: A Rally Against Mass Sur

By Aruna Viswanatha and David Ingram

WASHINGTON (Reuters) - The U.S. Justice Department said on Wednesday it had joined a lawsuit filed by a whistleblower against United States Investigations Services, the private firm that vetted Edward Snowden before he leaked documents about U.S. spying efforts.

While the lawsuit is not about the firm's review of Snowden, it alleges that USIS failed to perform quality control reviews in connection with its background investigations. It was originally filed in Alabama more than two years ago.

The government's decision to join the lawsuit adds to building public pressure on the firm, which is the U.S. government's biggest contractor for investigations of potential employees. The firm also vetted Aaron Alexis, the technology contractor who killed 12 people at the Washington Navy Yard last month.

A USIS spokeswoman said the firm was cooperating with the government's investigation and had replaced its leadership and improved its controls since they first heard of the allegations last year.

The firm has had a contract since 1996 to vet individuals seeking employment with federal agencies. Such background checks include investigative fieldwork on each application.

But since 2008, the firm used software to release investigations that were not yet complete in order to meet revenue targets, the government said.

The firm concealed the practice, known as "dumping," and improperly billed the federal Office of Personnel Management for the work, the DOJ said.

"The behavior by a small number of employees alleged in the complaint is completely inconsistent with our company values, culture and tradition of outstanding service to our government customers," the USIS spokeswoman said in an email.

The lawsuit was filed in July 2011 by a former employee of the firm, Blake Percival, under the False Claims Act. The law that lets people collect rewards for blowing the whistle on fraud against the government.

Percival said in the lawsuit that he was fired in June 2011 for refusing orders to "dump" cases that were not finished.

As a result of the Justice Department's decision to join, a judge unsealed the original lawsuit in U.S. District Court for the Middle District of Alabama. The department is now scheduled to file a revised complaint by January 22.

"We will not tolerate shortcuts taken by companies that we have entrusted with vetting individuals to be given access to our country's sensitive and secret information," a Justice Department official, Assistant Attorney General Stuart Delery, said in a statement.

The news of the lawsuit came the day before a U.S. Senate hearing scheduled to examine government clearances and background checks. Elaine Kaplan, acting director of the Office of Personnel Management, is among the expected witnesses.

(Editing by Cynthia Osterman)

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