Fastenal Settles Overcharge Claims for $6.25M
Winona-based Fastenal Company announced Thursday that it has paid $6.25 million to settle a dispute with the U.S. government over claims that it overcharged for products sold under a contract with the U.S. General Services Administration (GSA).
Fastenal entered into an agreement with the GSA in 2000 to supply products to government customers. That contract was discontinued in 2005.
The government claims that after an audit in 2005 and 2006, it discovered that Fastenal did not comply with certain pricing and product requirement provisions, and had potentially overcharged government customers under the contract.
Fastenal was notified by the government of the findings in July 2010. At that time, the government requested $9.5 million to settle the claims. Fastenal has not admitted any wrongdoing as part of the $6.25 million settlement, the company said in a statement.
“We continue to believe that we complied with our obligation under the GSA contract in all material respects,” Fastenal said in a statement. “However, we felt a continuation of our dispute…was not the best use of our resources.”
The company also said that the settlement will not have an adverse effect on its financial position.
Fastenal, which distributes industrial and constriction supplies, is among Minnesota's 25-largest public companies based on its 2009 revenue of $1.9 billion.