The Justice Department announced this week that Texas businessman Larry Lehmann has agreed to pay $400,000 in connection with his alleged role in corrupting the E-rate federal subsidy program in the Houston school system.

Congress created the E-rate Program in 1996 to subsidize internet access in libraries and public schools. When the Houston Independent School District (HISD) was awarded E-rate funding in 2004, the government alleged, Lehmann sought to win contracts by plying HISD officials with sports tickets and cash loans, and by illegally manipulating his company’s payrolls to shift costs from the school district to the E-rate program.

Lehmann’s is the latest in a string of settlements arising from DOJ’s investigations into E-rate improprieties in major Texas school districts. The government previously collected $16.25 million from Hewlett-Packard, $850,000 from HISD, and $750,000 from the Dallas Independent School District (DISD). The government’s campaign originated as a whistleblower suit brought by a third-party bidder for HISD’s business and a former FBI agent. Under the qui tam provisions of the False Claims Act, the whistleblowers will receive a portion of the amount the government recovers.

Read the entire press release, “Texas Businessman Agrees to Settle False Claims Allegations Involving the E-Rate Program”