NEW YORK STATE -- More than three dozen school districts in New York State, including Oneonta and Malone, are part of a multi-million dollar settlement for being overcharged for school lunches.
New York Attorney General Eric Schneiderman announced an $18 million settlement with Compass Group USA. Schneiderman says an investigation revealed Compass did not pass on vendor discounts to school districts from 2003 until 2010 that he says should have been, by law.
The settlement requires Compass to repay about $3 million to the schools. The state is expected to get about $15 million from damages and penalties under New York's False Claims Act.
Compass Group USA released a statement about the settlement. It says in part, "A misinterpretation of the New York contracts caused Chartwells to neglect to complete proper reconciliation of operating costs to the K-12 schools. We offered to make immediate payment of amounts due, which amounted to approximately $350 thousand annually over an 8-year period. We also took corrective measures to ensure that such discrepancies would not occur again. Compass Group is in full compliance with regulatory, contractual and legal requirements."