Jefferson County Scrap Metal Company Pays False Claims Act Damages for Receiving Brass Shell Casings from Fort Drum

SYRACUSE, NEW YORK – Northstar Auto and Salvage LLC, of Evans Mills, New York, has agreed to pay $45,000 to resolve allegations that it violated the False Claims Act by receiving government property from unauthorized individuals.

United States Attorney Carla B. Freedman and Special Agent in Charge Joel Kirch of the Northeast Field Office of the Department of the Army, Criminal Investigation Division made the announcement. 

When the Army conducts live-fire exercises at Fort Drum, brass shell cartridges (“brass”) are collected and returned to a centralized processing facility, where the brass is prepared for sale on the open scrap metal recycling market, thereby recovering money for the Government.  Northstar Auto and Salvage LLC (Northstar) purchases and processes scrap metal, but Northstar never had a contract to purchase Fort Drum brass.  From 2017-2019, a Fort Drum civilian employee and two soldiers took approximately 29,000 pounds of brass from the centralized processing facility.  Neither the civilian employee nor the soldiers were authorized to dispose of the brass. These individuals sold the brass to Northstar, delivering it in personally-owned pickup trucks, not military vehicles.  Northstar then sold the brass on the open market, receiving $24,012 in profit.  Northstar did not make any effort to verify whether the individuals were authorized to dispose of the brass, beyond accepting their verbal assurances that they were authorized. 

The knowing receipt of public property from a federal employee or member of the Armed Forces who lawfully may not sell such property, including acting with deliberate ignorance, violates the False Claims Act.  31 U.S.C. § 3729(a)(1)(F).

The investigation and settlement was the result of a coordinated effort among the United States Attorney’s Office for the Northern District of New York, and the Northeast Field Office of the Department of the Army, Criminal Investigation Division.  The New York State Police provided substantial assistance.  Assistant U.S. Attorney Christopher Moran represented the United States in this matter.