Carahsoft, FBI Confirm Raid On Reston Office; SAP Reportedly Involved

'Carahsoft is fully cooperating on this matter,' a spokesperson says.

Carahsoft confirmed to CRN that representatives from the United States Department of Justice came to the solution provider giant’s office Tuesday as part of an investigation into a separate company.

In an email, a spokesperson with the government-focused IT company–No. 16 on CRN’s 2024 Solution Provider 500–said the department is “conducting an investigation into a company with which Carahsoft has done business in the past.”

“Carahsoft is fully cooperating on this matter,” the spokesperson said. “We are operating business as usual.”

[RELATED: ClearML Allies With Carahsoft To Provide Its MLOps Platform To Government Agencies]

Carahsoft FBI Raid

A spokesperson with the FBI–which is part of the DoJ–confirmed in an email to CRN that the bureau “conducted court-authorized law enforcement activity on Sunset Hills Road yesterday morning,” declining to comment further. Carahsoft’s headquarters is on Sunset Hills Road in Reston, Va., according to its website.

Reports Wednesday said that U.S. officials are looking at SAP, Carahsoft and others for alleged price fixing.

An SAP spokesperson emailed CRN to say that the vendor is “not aware of any criminal investigation that SAP is involved in relating to Carahsoft.”

“All we can say is that there has been a civil investigation by the DOJ, and SAP has been cooperating with the investigation since the beginning,” the spokesperson said.

The raid might have come due to Carahsoft not producing a full set of transaction records for a Justice Department investigation, according to Nextgov/FCW. The raid happened Tuesday morning just days before the end of the U.S. government’s fiscal year, Sept. 30.

Justice Department lawyers started looking at SAP and Carahsoft at least in 2022 for potentially conspiring to overcharge the U.S. military and government agencies, according to Bloomberg. The probe focuses on more than $2 billion worth of SAP products sold to the U.S. government since 2014. Carahsoft has received more than 600 federal contracts for SAP products worth more than $990 million and facilitated another $1 billion or less in additional sales.

In 2015, Carahsoft and VMware agreed to pay $75.5 million to settle a False Claims Act case with the U.S. government that also alleged overcharging the government. The companies didn’t admit to wrongdoing as part of the settlement.

In January, SAP agreed to pay more than $220 million to settle bribery charges following investigations by the U.S. Securities & Exchange Commission and the U.S. Department of Justice.

Bloomberg added that a unit of Accenture–No. 1 on CRN’s 2024 Solution Provider 500–is also under federal scrutiny as part of the SAP probe while noting that investigations can end without a formal accusation of wrongdoing.

In October, a subsidiary of Accenture revealed a Department of Justice investigation into the company around “whether one or more employees provided inaccurate submissions to an assessor who was evaluating on behalf of the U.S. government an AFS (Accenture Federal Services) service offering and whether the service offering fully implemented required federal security controls.”

The Accenture investigation revealed in October is wholly unrelated to the SAP and Carahsoft incidents, according to a source.

An Accenture spokesperson told CRN in a statement that “Accenture Federal Services is responding to an administrative subpoena and is cooperating with the DOJ.”