A Woburn research and development company and its president have agreed to pay $2.25 million to resolve allegations that they violated the False Claims Act by seeking disbursements from federal agencies for falsified labor costs in order to maximize charges to grants and contracts awarded by federal agencies.

Agiltron Inc. is a company largely financed by federal government funding. The president of the company is Jing Zhao.

The settlement alleges that between 2009 and 2012, Agiltron received funds under 15 grants and contracts through the federal Small Business Innovation (SBIR) and Small Business Technology Transfer (STTR) programs. The government alleges that Agiltron and Zhao directed a scheme that allowed employees to charge fraudulent labor hours to the awards. In doing so, the company, and its president, allowed employees to alter their timesheets in order to maximize charges to the grants or contracts. Agiltron and Zhao allegedly directed and allowed employees to destroy documents with the proper instructions on allocating the hours on their timesheets.

The settlement agreement resolves multiple federal agencies’ claims for civil damages arising from allegations of fraudulent time-and-effort billing to SBIR/STTR grants and contracts.