United States of America: Department of Justice reached settlement of USD 17.1 million with International Business Machines Corporation over false certification of compliance with anti-discrimination requirements

On 10 April 2026, the United States Department of Justice entered into a USD 17.1 million settlement with International Business Machines Corporation (IBM) under the False Claims Act. The case concerned allegations that IBM falsely certified compliance with federal anti-discrimination obligations applicable to federal contractors while, in practice, maintaining employment practices that allegedly considered race, colour, national origin, and sex in hiring, promotion, compensation, and training decisions. These practices reportedly included the use of a diversity-related modifier linked to bonus compensation and demographic targets applied across business units. As part of the settlement, IBM agreed to pay USD 17.1 million, including civil penalties, and to identify and reimburse any unallowable costs previously charged to federal contracts. Federal contracting requirements obligate companies to certify that employment decisions are made without discrimination on the basis of protected characteristics and to take steps to ensure equal treatment throughout employment. The settlement resolves the government’s claims that IBM failed to comply with these certification and non-discrimination requirements.