When Asking for Money You Are Owed Becomes Fraud: The Contract Disputes Act Trap

Published 2026 | TIKC NewsWire

When the government changes the work, delays you, or fails to hold up its end, you have a right to be made whole. The Contract Disputes Act gives you a structured way to ask, through a request for equitable adjustment or a formal claim. But here is the trap that catches contractors who feel wronged and let frustration drive the numbers: the very document you use to recover money you are legitimately owed can become the evidence of fraud if you inflate it or certify it falsely. Asking is your right. Exaggerating is a crime.

Claims and REAs, briefly

Two instruments do most of the work. A request for equitable adjustment (REA) is a request to adjust the contract price or schedule, often to resolve a change or disruption without a formal dispute. A claim under the Contract Disputes Act is a more formal written demand for a sum certain or other relief, submitted to the contracting officer for a decision, and it opens the door to appeal at a board of contract appeals or the Court of Federal Claims. Both are legitimate, everyday tools. The difference that matters here is the certification.

The claim certification is a sworn statement

For claims above a dollar threshold, the Contract Disputes Act requires a certification: that the claim is made in good faith, that the supporting data are accurate and complete to the best of your knowledge, and that the amount requested accurately reflects what you believe the government owes. That certification is not a formality. It is a representation you are legally accountable for. Padding the numbers, including costs you know are not recoverable, or building a claim on figures you have not verified turns that certification into a false statement.

The fraud statutes waiting behind a bad claim

A fraudulent claim does not just fail. It can trigger a stack of penalties. The False Claims Act can apply, with treble damages. The Contract Disputes Act has its own anti-fraud provision that makes a contractor liable for an unsupported part of a claim attributable to misrepresentation or fraud, plus the government’s costs. And the forfeiture statute for fraudulent claims against the United States can cause a contractor to forfeit the entire claim, not just the inflated portion. In other words, one padded number can poison an otherwise valid claim and cost you far more than you tried to gain.

How to pursue what you are owed safely

The goal is not to discourage legitimate claims. You should absolutely recover what the government genuinely owes you. The discipline is to build the claim on real, documented costs, to include only what is recoverable under the contract and cost principles, and to certify only what you can support. Keep the contemporaneous records, the change documentation, the cost data, and the schedule analysis that prove your entitlement. A well-supported claim is both more likely to succeed and immune to the fraud trap.

What to do now

• Base every claim on documented costs. Build from real records, not estimates shaped by frustration.
• Include only recoverable costs. Screen out anything unallowable or outside the contract before you certify.
• Take the certification seriously. It is a sworn representation, so certify only what you can support.
• Keep contemporaneous records. Change orders, cost data, and schedule analyses are your proof of entitlement.
• Get review before submission. A second set of eyes on a large claim can catch a number that would become a liability.

Pursuing what you are owed is good business, and doing it honestly is what keeps it good business. Build the claim on the truth, and it protects you as much as it pays you. Brick by brick.

FAQ

What is the difference between an REA and a claim?

An REA is a request to adjust the contract price or schedule, often resolved informally. A claim under the Contract Disputes Act is a formal written demand submitted to the contracting officer for a decision, which can be appealed.

What does the claim certification require?

For claims above a threshold, you certify the claim is made in good faith, the supporting data are accurate and complete to the best of your knowledge, and the amount reflects what you believe the government owes.

What happens if I inflate a claim?

You can face False Claims Act treble damages, the Contract Disputes Act anti-fraud provision, and the forfeiture statute, which can cause you to lose the entire claim, not just the inflated part.

How do I pursue a claim safely?

Build it on real, documented costs, include only recoverable amounts, certify only what you can support, and keep contemporaneous records proving entitlement.

Sources

U.S. Congress. (2026). Contract Disputes Act, 41 U.S.C. 7101-7109, including the fraud provision.

U.S. Congress. (2026). Forfeiture of fraudulent claims against the United States, 28 U.S.C. 2514.

This article is general information, not legal advice.