U.S. Justice Department Accuses Oracle of Fraud

The U.S. Justice Department is accusing software company Oracle (ORCL) of defrauding the government on a contract worth over $1 billion.

In a complaint filed yesterday in U.S. District Court for the Eastern District of Virginia, the Justice Department alleges that Oracle misled the government about its business practices, causing government clients to get worse deals on Oracle's services than the company's private sector clients.

The Justice Department alleges that Oracle told employees of the General Services Administration that federal government customers would receive a larger discount than similarly sized corporate clients, the Wall Street Journal reported.

In fact, the Justice Department says, Oracle offered larger discounts to over 90% of its corporate clients, and tried to conceal this information from government officials.