Dow Chemical To Pay $456K Over Allegations Against Former Subsidiary

MINNEAPOLIS — Dow Chemical has agreed to pay nearly $456,000 over allegations against Poly Carb, its former subsidiary, U.S. Attorney Andrew M. Luger announced Friday.

Federal authorities accused Poly Carb of violating the Federal False Claims Act and the Minnesota False Claims Act by falsifying testing results in connection with several road construction projects administered by MnDOT, including some that were federally funded.

"Submitting forged and fabricated documents to the government is never acceptable," Luger said in a statement. "In coordination with our state partners, we will continue using the False Claims Act to address fraudulent conduct by government contractors, subcontractors, and suppliers."

The claims resolved under Dow's settlement are allegations and there was no determination of liability, authorities said.

Between 2012 and 2015, Poly Carb sold the state of Minnesota enamel paint products. However, Poly Carb fabricated test results and forged signatures and documentation for those products, authorities said.

The proceeds of the settlement will be divided and given back to the federal and state governments based on the original funding of the projects.

"Resolving this civil case advances our efforts to keep federally funded transportation projects free from fraud, waste, and abuse," said Andrea M. Kropf, an agent for the U.S. Department of Transportation Office of Inspector General.

"When improper activities like this come to our attention we will work with our federal, state, and prosecutorial partners to investigate and hold those involved accountable."

Editor's note: This article has been updated with clarifications about the settlement and Dow Chemical's relationship with Poly Carb