German-based Hahn Air Lines and its U.S. subsidiary agreed to pay $26.8 million to settle alleged violations of the False Claims Act over knowingly failing to provide remittance for travel fees it collected from commercial airline passengers flying into or within the United States.
Hahn Air and Minneapolis-based Hahn Air USA will pay approximately $18.3 million in federal restitution, the Department of Justice (DOJ) said in a settlement agreement dated Feb. 9. The airline was credited about $16 million for previous remittance, bringing the total owed to the government to about $10.7 million.
The settlement resolves claims brought under the qui tam provision of the False Claims Act by MGSNOVA Advisory, the DOJ said in a press release Thursday. The whistleblower will receive approximately $4.8 million of the settlement amount, including an additional $355,000 to cover attorneys’ fees, expenses, and costs related to the civil action.
The details: From 2012 to 2018, Hahn Air avoided paying to the United States fees owed to the Department of Agriculture, Customs and Border Protection, and the Transportation Security Administration (TSA), the DOJ alleged.
Hahn Air’s primary business includes offering an electronic database that allows travel agencies worldwide to issue tickets based on agreements the company has with commercial airlines around the world. During the relevant period, the company avoided or decreased its obligations to remit or transfer fees owed to the TSA collected by third-party ticket agents, according to the DOJ.
“[The] settlement demonstrates that we will protect the taxpayers by ensuring that those who are obligated to pay money to the United States, whether in the form of travel fees or other types of payments, are held accountable for what they owe,” said Brian Boynton, head of the DOJ’s Civil Division, in the release.
Hahn Air did not respond to a request for comment. The company agreed to settle without admitting liability.
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