|
Use
the links below to view a specific federal investigation
regarding the diversion of federal small business
contracts to large corporations.
*************************************
Donald Rumsfeld Speech About Bureaucratic Waste September 10, 2001
http://www.asbl.com/documents/Donald_Rumsfeld_Speech_About_Bureaucratic_Waste.pdf
Summary: On September 10th 2001, Secretary Of Defense Donald
H. Rumsfeld gave a speech on “The national security threat posed by
military bureaucratic inefficiency and waste.” The Secretary Of Defense
addressed the $2.3 trillion in Pentagon transactions that could not be
tracked, as well as the Defense Departments responsibility for an annual
waste of 3$ to $4 billion a year in in American tax dollars.
"The topic today is
an adversary that poses a threat, a serious threat, to the security of
the United States of America. This adversary is one of the world’s last
bastions of central planning. It governs by dictating five-year plans.
From a single capital, it attempts to impose its demands across time
zones, continents, oceans and beyond. With brutal consistency, it stifles
free thought and crushes new ideas. It disrupts the defense of the United
States and places the lives of men and women in uniform at risk. Perhaps
this adversary sounds like the former Soviet Union, but that enemy is
gone: our foes are more subtle and implacable today. You may think I’m
describing one of the last decrepit dictators of the world. But their
day, too, is almost past, and they cannot match the strength and size of
this adversary. The adversary’s closer to home. It’s the Pentagon bureaucracy. "
|
Professor Charles Tiefer Opinion on Legality of Proposed Regulations on Strategic Sourcing
http://www.asbl.com/documents/Tiefer_Opinion_GSA_FSSI.pdf
Summary: Opinions on: (1) Proposed "Strategic Sourcing" Rules do not provide small business with the "Maximum Practicable Opportunity".
(2) Many highly respected figures at recent Congressonal hearings believe Strategic Sourcing will reduce breadth of small businesses.
(3) The rule proposers failed to come up with alternatives.
(4) The rule proposers provided no justification for new regulations that would put Strategic Sourcing ahead of small business contracts.
(5) The rule proposers failed to conduct any regulatory flexibility inquiry.
"The proposal should be junked. It would have an overwhelmingly bad impact on the breadth of small business contracting, contrary to the
intent of the small business laws. If the rule proponents start over, they should look for alternatives to minimize this impact. They should spare aspects and sectors like Federal Supply Schedules, Simplified Acquisition contracting, and IT contracting."
|
Professor Charles Tiefer’s Legal Opinion on small business contracting fraud
http://www.asbl.com/documents/2013_Tiefer_Opinion.pdf
Summary: Opinions on: (1) Large Businesses wrongfully hold SBA contractors both by acquiring small contractors
(2) and by contracting with formerly small businesses after their graduation.
(3) The SBA wrongfully reduces the scope of contracting counted in applying the 23% small business goal.
“The bottom line is that there is a real societal cost when ineligible companies improperly profit from preferential contracting through fraud and illegal conduct….
This fraud thwarts congressional intent behind these programs and deprives legitimate small businesses of contracting opportunities.”
“Thus, the problem is that SBA and the contracting agency are failing in their duties to police the arrangements made by small businesses with large businesses and/or after graduation.
SBA and the agency are failing to demand recertifications, and failing to take action in the absence of valid certifications of continuing small size.”
“The figure of $1.1 trillion as the total amount that should be used for the 23% goal has been put forth in the media. Without breaking down the specific numbers,
it should be evident that if all these categories currently excluded were included, the total funding for which to apply that 23% goal could reach that figure.”
|
May Oversight Report | Congressional Oversight Panel | The Small Business Credit Crunch and the Impact of TARP | May 13, 2010
http://cop.senate.gov/documents/cop-051310-report.pdf
Summary: Small businesses have long been an engine of economic growth and job
creation in America. More than 99 percent of American businesses employ 500 or fewer employees,
and together these companies employ half of the private workforce and create two out of every
three new jobs. If the Troubled Asset Relief Program (TARP) is to meet its Congressional mandate
to promote growth and create jobs, then it clearly must address the needs of small businesses.
"To the extent that contraction in small business lending reflects a shortfall of demand
rather than of supply, any supply-side solution will fail to gain traction."
"Because small businesses play such a critical role in the American economy, there is
little doubt that they must be a part of any sustainable recovery. It remains unclear,
however, whether Treasury's programs can or will play a major role in putting small
businesses on the path to growth."
"Supply-side solutions that rely on bank balance sheets, such as the CPP [Capital Purchase Program]
and the SBLF [Small Business Lending Fund], may not increase lending. Even if Treasury succeeds in
increasing the supply of credit, its efforts may still come to naught if the demand for credit fails to keep pace."
“The largest TARP program, the Capital Purchase Program (CPP), provided hundreds of billions of
dollars in new capital to banks, but Treasury did not require recipients to use the money to improve
credit access. In fact, after receiving the money, most recipients decreased their lending.”
|
GAO-10-425 | Report to the Chairwoman, Committee on Small Business, House of Representatives | 8(a) PROGRAM: Fourteen Ineligible Firms Received $325 Million in Sole-Source and Set-Aside Contracts | March 2010
http://www.gao.gov/new.items/d10425.pdf
Summary: GAO identified $325 million in set-aside and sole-source contracts
given to firms not eligible for the 8(a) program. Most were obtained through fraudulent schemes.
In the 14 cases GAO investigated, numerous instances were found where 8(a) firm presidents made
false statements, such as underreporting income or assets, to either qualify for the program or
retain certification.
"In some cases, SBA did not detect the false statements and misrepresentations made
by certified firms. In others, SBA became aware of the firms' ineligibility but failed to take action."
"Certification of GAO's bogus firm shows vulnerabilities in the process such as the lack of
any face to face contact that could allow ineligible individuals or pass through companies to
enter the program. Although we were unable to determine whether all 14 cases were ineligible
at application, these cases show substantial vulnerabilities in SBA's monitoring of eligibility
for individuals and firms already in the program. The lack of a consistent enforcement strategy
or any real consequences for fraud and abuse is a further weakness in SBA's fraud prevention program."
|
SBA OIG Report 10-08 | SBA'S EFFORTS TO IMPROVE THE QUALITY OF ACQUISITION DATA IN THE FEDERAL PROCUREMENT DATA SYSTEM | February 26, 2010
http://www.sba.gov/idc/groups/public/documents/sba_homepage/oig_report_10-08.pdf
Summary: This report presents the results of an audit of the quality of SBA' s
acquisition data in the Federal Procurement Data System (FPDS). Based on data quality concerns
raised by the Government Accountability Office (GAO), in 2007 the Office of Management and Budget
(OMB) issued a directive requiring Federal agencies to annually certify to the accuracy of procurement
data reported in FPDS.
"Since SBA contract actions in FPDS contain information not matching the data in
the contract files, inaccurate information is being made available to Congress and
the public on SBA contracting activities, including potential Recovery Act actions.
Also, SBA's Goaling Report may contain inaccurate information concerning the extent
to which the Agency met its small business goals."
"We found that SBA certified to the accuracy of its FY 2008 contracting data, although
92 percent of the contract actions in our sample contained one or more inaccurate or
incomplete data elements in FPDS. While SBA had developed a data quality plan for FY
2008, it did not fully implement the plan, which contributed to the errors identified."
"Finally, while the accuracy of some data elements improved in FY 2009, overall there
was a higher rate of error in the FY 2009 data. Approximately 97 percent of the contract
actions in our sample contained one or more inaccurate or incomplete data elements, indicating
again that SBA contracting personnel were not properly reviewing data entries."
|
DHS OIG-10-54 | CBP Faces Challenges in Achieving Its Goals for Small Business Participation in Secure Border Initiative Network | February 2010
http://www.dhs.gov/xoig/assets/mgmtrpts/OIG_10-54_Feb10.pdf
Summary: This report presents the results of Department of Homeland Security's Office of Inspector General's review to determine whether
U.S. Customs and Border Protection's Secure Border Initiative Network contracting strategies will provide access to small business for the term of the contract.
It is based on interviews with CBP employees, direct observations, and a review of applicable documents.
"The prime contractor Boeing, has implemented initiatives to improve small business
participation in Secure Border Initiative Network subcontracts to achieve its subcontracting
goals. Despite these initiatives, the contractor has not achieved the established goals for
small business participation since the reporting period ended September 2007."
"Nonetheless, overall small business participation has not met established goals."
|
GAO-10-255T | Testimony Before the Committee on Small Business, House of Representative | SERVICE-DISABLED
VETERAN-OWNED SMALL BUSINESS PROGRAM | November 19,2009
http://www.gao.gov/new.items/d10255t.pdf
Summary: Statement of Gregory D. Kutz, Managing Director Forensic Audits and Special
Investigations. GAO found that the SDVOSB program is vulnerable to fraud and abuse, which could result in
legitimate service-disabled veterans' firms losing contracts to ineligible firms.
"Since the SDVOSB program began, the government has not met its annual mandated goal of 3 percent."
"Fraud and abuse in the SDVOSB program allowed ineligible firms to improperly receive millions
of dollars in set-aside and sole-source SDVOSB contracts, potentially denying legitimate service-disabled
veterans and their firms the benefits of this program."
"In the case of a pass-through, a firm or joint venture lists a service-disabled veteran
as the majority owner, but contrary to program requirements, all work is performed and managed
by a non-service-disabled person or a separate firm."
|
GAO-10-108 | SERVICE-DISABLED VETERAN-OWNED SMALL BUSINESS PROGRAM - Case Studies Show
Fraud and Abuse Allowed Ineligible Firms to Obtain Millions of Dollars in Contracts | October 2009
http://www.gao.gov/new.items/d10108.pdf
Summary: GAO found that the SDVOSB program is vulnerable to fraud and abuse,
which could result in legitimate service-disabled veterans' firms losing contracts to ineligible firms.
"By failing to hold firms accountable, SBA and contracting agencies have sent a message to
the contracting community that there is no punishment or consequences for committing fraud."
"The 10 case study firms identified in this report received approximately $100 million
from SDVOSB contracts through fraud or abuse of the program, or both. For example, contracts
for Hurricane Katrina trailer maintenance were awarded to a firm whose owner was not a
service-disabled veteran. GAO also found SDVOSB companies used as a pass-through for large,
sometimes multinational corporations."
"GAO found that the government does not have effective fraud-prevention controls in place
for the SDVOSB program. Specifically, SBA and agencies awarding SDVOSB contracts do not have
processes in place to validate a firm's eligibility for the program prior to bid submission."
|
United States Senate Committee on Homeland Security & Governmental Affairs,
Subcommittee On Contracting Oversight | Achieving the President's Objectives: New OMB
Guidance to Combat Waste, Inefficiency, and Misuse in Federal Government Contracting | October 28, 2009
http://mccaskill.senate.gov/pdf/102809/2009-10-27contractingworkforcedevelopmentsummary.pdf
http://mccaskill.senate.gov/pdf/102809/2009-10-27CompetitionGuidance.pdf
http://mccaskill.senate.gov/pdf/102809/CMCopeningstatement.pdf
Summary: Between 2000 and 2008, government spending on contracts increased 149%,
with $530 billion in contract spending in fiscal year 2008. Citing this increase and accompanying
waste and abuse in sole-source, cost-reimbursement, and other contracting methods, President Obama,
on March 4, 2009, issued a Memorandum for the heads of Executive Branch Departments and Agencies,
stating that the federal government "should perform its functions efficiently and effectively while
ensuring that its actions result in the best value for the taxpayers."
"Step 6: Give maximum practicable consideration to small businesses, including minority
businesses, and businesses owned by women and veterans."
"Small businesses provide creativity, innovation, and technical expertise to support a
wide range of agency requirements at good prices, but are sometimes overlooked as suppliers."
"…requirements were grouped inconsistent with the way services are commonly performed or
provided by industry, or otherwise bundled to make it difficult for small businesses to compete."
|
SBA OIG Report 10-02 | FISCAL YEAR 2010 REPORT ON THE MOST SERIOUS MANAGEMENT AND PERFORMACE CHALLENGES FACING THE SMALL BUSINESS ADMINISTRATION | October 16, 2009
http://www.sba.gov/idc/groups/public/documents/sba_homepage/oig_reports_tmc_fy10.pdf
Summary: This report represents the OIG's current assessment of Agency programs
and/or activities that pose significant risks, including those that are particularly vulnerable to
fraud, waste, error, mismanagement, or inefficiencies. The number one issue is that procurement flaws
allow large firms to obtain small business awards and agencies to count contracts performed by large firms
towards their small business goals.
"Office of Inspector General (OIG) audits and other governmental studies have shown widespread
misreporting by procuring agencies; many contract awards recorded as going to small firms have actually
been performed by larger companies."
"SBA needs to do more to ensure that contracting personnel are adequately trained on small business
procurement procedures and are reviewing ORCA data prior to awarding contracts."
"The Agency also needs to address a loophole within General Services Administration Multiple Awards Schedule
(MAS) contracts that contain multiple industrial codes. Currently, a company awarded such a contract can
identify itself as small on individual task orders awarded under that contract even though it does not meet the
size criteria for the applicable task. Thus, agencies may obtain small business credit for using a firm classified
as small, when the firm is not small for specific orders under such a MAS contract."
|
GAO-09-1032T | Testimony Before the Subcommittee on Contracting Oversight, Committee on Homeland
Security and Governmental Affairs, U.S. Senate | FEDERAL CONTRACTING - Observations on the Government’s Contracting
Data Systems | September 29, 2009
http://www.gao.gov/new.items/d091032t.pdf
Summary: Statement of William T. Woods, Director Acquisition and Sourcing Management.
GAO's testimony, which is based on prior reports, describes three governmentwide contracting data systems
and the weaknesses GAO has identified with these systems.
"We have identified weaknesses in three contracting data systems through our past audit work. These weaknesses fall
generally into three categories: poor data quality, limited data submission, and inadequate system capabilities."
|
Senate Commerce Committee Report | Cases of SBIR Waste, Fraud and Abuse | August 2009
http://commerce.senate.gov/public/_files/8609StaffAnalysisExhibit2.pdf
Summary: In the course of investigating the NETECH case and the SBIR program, Commerce Committee staff
learned of other instances in which SBIR awardees defrauded the government. Using online searches and case files produced
by the Inspectors General of NASA and NSF, Committee staff has collected 29 cases of SBIR fraud between 1990 and the present.
These cases involved more than 300 SBIR or STTR contracts valued at more than $100 million dollars. Information about these
cases is presented in a table in the following pages.
“…these cases provide important information about the features of the SBIR program that are most vulnerable to waste, fraud, and abuse.”
"When he was asked about SBIR fraud, NSF Deputy Inspector General, Philip Sunshine, told the Committee that,
'compared to other programs at the agency, there is more fraud in the SBIR program than any other program.' "
"Companies have misrepresented the qualifications of their researchers, presented plagiarized data as their own,
and forged signatures on proposals in order to win grants or contracts. As a general matter, the awarding agencies rely
on companies' self-certification that the information in their proposals is accurate and truthful. A federal appeals court
recently noted that 'the DOD generally does not verify all of the information submitted in a proposal, and it depends heavily
on the integrity of SBIR applicants.'"
|
United States Senate Committee on Homeland Security & Governmental Affairs | NEW INFORMATION ABOUT CONTRACTING PREFERENCES FOR ALASKA NATIVE CORPORATIONS (Part 1 and 2) | July 16, 2009
http://hsgac.senate.gov/public/index.cfm?FuseAction=Files.View&FileStore_id=A791908F-1E69-4ECE-9C79-0E334AA3B451
http://mccaskill.senate.gov/pdf/071509/ANC.pdf
Summary: Examines concerns relating to the award of contracts to Alaska Native Corporations (ANCs)
through the Small Business Administration's 8(a) program. The preference given to Alaska Native Corporations in
federal procurement was intended to provide economic opportunities for impoverished Alaskan communities. In recent years,
however, critics have identified these preferences as a vehicle for avoiding competition and passing work through to large,
non-Native contractors.
"The analysis finds that Alaska Native Corporations are multi-million or billion dollar corporations that are
now among the largest federal contractors. Although ANCs provide some benefits to their shareholders, those benefits
may not be in proportion to the potential for waste, fraud, and abuse created by the ANCs' contracting preferences."
"Alaska Native Corporations are big businesses. The majority of the Alaska Native Corporations surveyed by the
Subcommittee exceed the size requirements applicable to other 8(a) companies. 11 out of the 19 companies - Afognak,
Ahtna, Arctic Slope, Bristol Bay, Chenega, Chugach, the Cook Inlet Region, Inc. (CIRI), Doyon, Koniag, NANA, and Sealaska -
have had annual revenues higher than the Small Business Administration's limit since 2002."
"In 2008, approximately 80% of the contract dollars awarded to ANCs was performed outside of Alaska. In 2004, 2006,
2007, and 2008, more contracts were performed in Virginia than Alaska."
|
SBA OIG Report 09-02 | FISCAL YEAR 2009 REPORT ON THE MOST SERIOUS MANAGEMENT AND
PERFORMACE CHALLENGES FACING THE SMALL BUSINESS ADMINISTRATION | October 20, 2008
http://www.sba.gov/idc/groups/public/documents/sba/oig_reports_tmc_fy09.pdf
Summary: This report represents the OIG's current assessment of Agency
programs and/or activities that pose significant risks, including those that are particularly
vulnerable to fraud, waste, error, mismanagement, or inefficiencies. The number one issue is
that procurement flaws allow large firms to obtain small business awards and agencies to count
contracts performed by large firms towards their small business goals.
"Office of Inspector General (OIG) audits and other governmental
studies have shown widespread misreporting by procuring agencies; many
contract awards recorded as going to small firms have actually been performed
by larger companies."
"While some contractors may misrepresent or erroneously calculate their size,
most incorrect reporting results from errors made by government contracting personnel.
Noted errors include acceptance of questionable size self-certifications and misapplication
of small business contracting rules."
"…the Small Business Administration (SBA) should strive to ensure that only small
firms obtain small business awards and that procuring agencies accurately report
contracts awarded to small businesses when representing its progress in meeting small
business contracting goals."
|
USVentCap061009r1 | RIGHT-SIZING THE U.S.
VENTURE CAPITAL INDUSTRY | June 10, 2009
http://www.kauffman.org/uploadedFiles/USVentCap061009r1.pdf
Summary: The report evaluated
venture financing among companies on the Inc. 500
list of the fastest-growing private companies.
Only approximately 16 percent of the roughly 900
unique companies on the list from 1997-2007 had
venture capital backing. The report also noted
that only a tiny percentage (less than 1 percent)
of the estimated 600,000 new employer businesses
created in the United States every year obtain
venture capital financing.
"We recently studied the prevalence of
venture capital financing among companies
on the Inc. 500 list of the fastest-growing
private companies in the United States. Looking
across ten years of that list-roughly 900
unique companies from 1997-2007-we found
that approximately 16 percent of the companies
had venture capital backing. In other words,
even among the fastest growing and most successful
companies in the U.S., less than one-in-five
companies had venture investors."
|
GAO-09-440 | HUBZONE PROGRAM - FRAUD AND
ABUSE IDENTIFIED IN FOUR METROPOLITAN AREAS | March 25, 2009
http://www.asbl.com/documentlibrary.html
Summary: GAO found that fraud
and abuse in the HUBZone program extends beyond
the Washington, D.C., area. GAO identified 19 firms
in Texas, Alabama, and California participating
in the HUBZone program that clearly do not meet
program requirements (i.e., principal office location
or percentage of employees in HUBZone and subcontracting
limitations).
" Our work on the HUBZone program to date
has shown that numerous ineligible firms
have taken advantage of the opportunity to
commit fraud against the federal government."
"SBA's failure to promptly remove firms
from the HUBZone program and examine
some of the most egregious cases from
GAO's July 2008 testimony has resulted
in an additional $7.2 million in HUBZone
obligations and about $25 million in
HUBZone contracts to these firms. For
example, a construction firm from the
July 2008 testimony admitted that it
did not meet HUBZone requirements and
was featured in several national publications
by name. It has continually represented
itself as HUBZone certified and has received
$2 million in HUBZone obligations and
a $23 million HUBZone setaside contract
since the July 2008 testimony."
"Of the 19 firms that did not meet
HUBZone eligibility requirements, we
found that all of them continued to represent
themselves as eligible HUBZone interests
to SBA. Because the 19 case examples
clearly are not eligible, we consider
each firm's continued representation
indicative of fraud and/or abuse related
to this program."
"To date, other than the firms identified
by our prior investigation, the SBA program
office has never referred any firms for
debarment and/or suspension proceedings
based on their findings from their program
eligibility reviews. By failing to hold
firms accountable, SBA has sent a message
to the contracting community that there
is no punishment or consequences for
committing fraud or abusing the intent
of the HUBZone program."
|
GAO-09-174 | EXCLUDED
PARTIES LIST SYSTEM - SUSPENDED AND DEBARRED
BUSINESSES AND INDIVIDUALS IMPROPERLY RECEIVE
FEDERAL FUNDS | February 2009
http://www.gao.gov/new.items/d09174.pdf
Summary: Businesses and individuals that have been
excluded for egregious offenses ranging from national security violations
to tax fraud are improperly receiving federal contracts and other
funds. GAO developed cases on a number of these parties and found
that they received funding for a number of reasons, including because
agency officials failed to search EPLS or because their searches
did not reveal the exclusions. GAO also identified businesses and
individuals that were able to circumvent the terms of their exclusions
by operating under different identities.
Top of Page
GAO-09-16 | SMALL BUSINESS
ADMINISTRATION – AGENCY SHOULD ASSESS RESOURCES
DEVOTED TO CONTRACTING AND IMPROVE SEVERAL PROCESSES
IN THE 8(A) PROGRAM | November 21, 2008
http://www.gao.gov/new.items/d0916.pdf
Summary: SBA’s administration of the 8(a) business
development program is challenged by several factors, including some
participants not understanding the program’s purpose and requirements,
its staff’s diminished ability to conduct business development activities,
an inefficient process to terminate firms, and a lack of routine
surveillance reviews specific to the program.
GAO-08-995 | SMALL
BUSINESS ADMINISTRATION – OPPORTUNITIES EXIST
TO BUILD ON LEADERSHIP’S EFFORTS TO IMPROVE AGENCY
PERFORMANCE AND EMPLOYEE MORALE | September 2008
http://www.gao.gov/new.items/d08995.pdf
Summary: Over the past 6 years, the Small Business
Administration (SBA) has sought to transform the agency and improve
its operations. The GAO concluded that extreme budget and staffing
reductions have led to continued and ongoing problems in administering
programs and with employee morale.
Top of Page
SBA OIG REPORT 8-14 | NON-NATIVE
MANAGERS SECURED MILLIONS OF DOLLARS FROM 8(A)
FIRMS OWNED BY ALASKA NATIVE CORPORATIONS THROUGH
UNAPPROVED AGREEMENTS THAT JEOPARDIZE THE FIRMS’ PROGRAM
ELIGIBILITY | August 7, 2008
http://www.sba.gov/idc/groups/public/documents/sba/oig_reptbydate_8-14.pdf
Summary: The purpose of this report is to notify
you of two 8(a) participants owned by Alaska Native Corporations
(ANC) APM, LLC (APM) and Goldbelt Raven, LLC (Goldbelt) who did not
comply with the terms and conditions of their Participation Agreements,
creating grounds for their termination from the 8(a) program. Based
on concerns raised by the Government Accountability Office (GAO)
and Congress that ANC-owned firms may be serving as conduits for
large businesses, the audit is examining the percentage of 8(a) contract
revenue reaching Alaska natives.
DOI OIG REPORT W-EV-MOI-0003-2008
| INTERIOR MISSTATED ACHIEVEMENT OF SMALL BUSINESS
GOALS BY INCLUDING FORTUNE 500 COMPANIES| July
1, 2008
http://www.doioig.gov/upload/2008-G-0024.pdf
Summary: Department of Interior’s Office of Inspector
General conducted an investigation examining if small business contract
awards that were being counted towards the agencies small business
goals were going to large or Fortune 500 firms.
Top of Page
GAO-08-643 | SMALL
BUSINESS ADMINISTRATION – ADDITIONAL ACTIONS
ARE NEEDED TO CERTIFY AND MONITOR HUBZONE BUSINESSES
AND ASSESS PROGRAM RESULTS | June 2008
http://www.gao.gov/new.items/d08643.pdf
Summary: The Historically Underutilized Business
Zone (HUBZone) program is intended to provide federal contracting
opportunities to qualified small business firms in order to stimulate
development in economically distressed areas. As manager of the HUBZone
program, the Small Business Administration (SBA) is responsible for
certifying whether firms meet HUBZone program requirements. To participate
in the HUBZone program, small business firms must certify that their
principal office is located in a HUBZone and that at least 35 percent
of the firm's employees live in HUBZones. GAO identified substantial
vulnerabilities in SBA's application and monitoring process, clearly
demonstrating that the HUBZone program is vulnerable to fraud and
abuse.
SBA OIG Report 08-01 | FISCAL YEAR 2008 REPORT ON THE MOST SERIOUS MANAGEMENT AND PERFORMACE CHALLENGES FACING THE SMALL BUSINESS ADMINISTRATION | October 16, 2007
http://www.sba.gov/idc/groups/public/documents/sba/oig_reports_tmc_fy08.pdf
Summary: This report represents the OIG's current assessment of Agency programs and/or
activities that pose significant risks, including those that are particularly vulnerable to fraud, waste,
error, mismanagement, or inefficiencies. The number one issue is that procurement flaws allow large firms
to obtain small business awards and agencies to count contracts performed by large firms towards their small business goals.
"Large companies improperly obtain small business contracts due to a variety of problems.
Some contractors obtain small business contracts for which they are not eligible by misrepresenting
their size or by not diligently verifying whether they meet size criteria. In other cases, improper
awards result from errors by contracting personnel, such as accepting questionable size self certifications
or possible unfamiliarity with small business contracting procedures."
"SBA needs to do more to promote contractor accuracy, ensure that government contracting personnel
receive adequate training on small business procurement procedures, and encourage greater accuracy in
Federal agency small business contracting reports."
|
SBA OIG Report 07-01 | FISCAL YEAR 2007 REPORT ON THE MOST SERIOUS MANAGEMENT AND PERFORMACE CHALLENGES FACING THE SMALL BUSINESS ADMINISTRATION | October 16, 2006
http://www.sba.gov/idc/groups/public/documents/sba/oig_reports_tmc_fy07.pdf
Summary: This report represents the OIG's current assessment of Agency programs
and/or activities that pose significant risks, including those that are particularly vulnerable
to fraud, waste, error, mismanagement, or inefficiencies. The number one issue is that procurement
flaws allow large firms to obtain small business awards and agencies to count contracts performed
by large firms towards their small business goals.
"SBA also needs to work to close regulatory loopholes that allow agencies to take credit
for meeting their small business procurement goals even though contracts are performed by large
firms. For example, multiple award contracts, such as the General Services Administration Multiple
Awards Schedule (MAS) Program and Government Wide Acquisition Contracts (GWACs), are structured so
that a company's size is only relevant when admitted to the initial contract, not for the task orders
issued under the contract. Task orders can be issued under these contracts for many years after the contract is awarded."
"In 2003, SBA proposed a regulation requiring companies to certify as to their size on an
annual basis, but it now appears that a rule with a one-year certification requirement will not
be issued. If this is the case, the OIG will reevaluate the matter to assess whether the Agency
should take other steps to address this problem."
"The Agency also needs to address another loophole with MAS contracts that contain multiple
industrial codes. In being awarded such a contract, a company can identify itself as small even
though it does not meet the size criteria for every industrial code. Thus, agencies may obtain
small business credit for using a firm classified as small even if the firm is not small for the
specific goods or services procured through a particular task order under such a MAS contract."
|
GAO-06-874T | TESTIMONY
BEFORE THE COMMITTEES ON GOVERNMENT RFORM AND
SMALL BUSINESS |ALASKA NATIVE CORPORATIONS – INCREASED
USE OF SPECIAL 8(A) PROVISIONS CALLS FOR TAILORED
OVERSIGHT | June 21, 2006
http://www.gao.gov/new.items/d06874t.pdf
Summary: Congress has extended special procurement
advantages to 8(a) ANC firms, such as the ability to receive sole-source
contracts for any dollar amount and to own multiple subsidiaries
in the 8(a) program. We were asked to testify on an earlier report
where we identified (1) trends in the government’s 8(a) contracting
with ANC firms, (2) the reasons agencies have awarded 8(a) solesource
contracts to ANC firms and the facts and circumstances behind some
of these contracts, and (3) how ANCs are using the 8(a) program.
GAO also evaluated SBA’s oversight of 8(a) ANC firms.
Top of Page
GAO-06-791R | COMMERCE
INFORMATION TECHNOLOGY SOLUTIONS NEXT GENERATION
GOVERNMNETWIDE ACQUISITION CONTRACT| June 14,
2006
http://www.gao.gov/new.items/d06791r.pdf
Summary: Concerns have been raised about the fairness
of the “bid down” approach of the Department of Commerce’s Information
Technology Solutions Next Generation (COMMITS NexGen) contract. In
response to these concerns, the fiscal year 2006 Science, the Departments
of State, Justice, and Commerce, and Related Agencies appropriations
conference report requested our review of COMMITS NexGen.
GAO-06-399 |CONTRACT
MANAGEMENT – INCREASED USE OF ALASKA NATIVE CORPORATIONS’ SPECIAL
8(A) PROVISIONS CALLS FOR TAILORED OVERSIGHT
| April 2006
http://www.gao.gov/new.items/d06399.pdf
Summary: In reviewing selected large, sole-source
8(a) contracts awarded to Alaska Native Corporation (ANC) firms,
GAO found that contracting officials had not always complied with
certain requirements, such as notifying SBA of contract modifications
and monitoring the percent of work that is subcontracted.
Top of Page
SBA OIG MANAGEMENT ADVISORY
REPORT 6-18 | THE CENTRAL CONTRACTOR REGISTRATION
NEEDS LARGE BUSINESS AND SMALL BUSINESS DESIGNATION
IMPROVEMENTS | March 21, 2006
http://www.sba.gov/idc/groups/public/documents/sba/oig_reptbydate_6-18.pdf
Summary: While reviewing a congressional request
to determine whether a Hurricane Katrina related Federal Emergency
Management Agency (FEMA) contract was appropriately reported as a
small business in the Federal Procurement Data System – Next Generation
(FPDS – NG), we noted that the General Services Administration’s
(GSA) Integrated Acquisition Environment’s (IAE) initiative, the
Central Contractor Registration (CCR), allows contradictory information
on a contractor’s size status to be included in the system.
SBA OIG AUDIT REPORT 6-15
| AUDIT OF MONITORING COMPLIANCE WITH 8(A) BUSINESS
DEVELOPMENT REGULATIONS DURING 8(A) BUSINESS
DEVELOPMENT CONTRACT PERFORMANCE | March 16,
2006
http://www.sba.gov/idc/groups/public/documents/sba/oig_reptbydate_6-15.pdf
Summary: The Office of Inspector General (OIG) completed
an audit to determine whether Federal agencies were effectively monitoring
compliance with 8(a) Business Development (BD) regulations when completing
8(a) BD contracts.
SBA OIG Report 06-02 | FISCAL YEAR 2006 REPORT ON THE MOST SERIOUS MANAGEMENT AND PERFORMACE CHALLENGES FACING THE SMALL BUSINESS ADMINISTRATION | October 14, 2005
http://www.sba.gov/idc/groups/public/documents/sba/oig_reports_tmc_fy07.pdf
Summary: This report represents the OIG's current assessment of Agency programs and/or
activities that pose significant risks, including those that are particularly vulnerable to fraud, waste,
error, mismanagement, or inefficiencies. The number one issue is that procurement flaws allow large firms
to obtain small business awards and agencies to count contracts performed by large firms towards their small business goals.
"This year's report contains one new Challenge-Challenge #1-that states that 'Flaws in the procurement
process allow large firms to receive small business awards and agencies to receive small business credit
for contracts performed by large firms.'"
"Studies by the Government Accountability Office (GAO), SBA's Office of Inspector General (OIG), and
SBA's Office of Advocacy found that agencies are counting contracts performed by large firms towards their
small business procurement goals."
"Large companies also improperly receive small business contracts due to errors by contracting personnel."
|
Top of Page
SBA
OIG SEMI-ANNUAL REPORT | September 2005
http://www.sba.gov/idc/groups/public/documents/sba/oig_sar-9-2005.pdf
Summary: During this reporting period, we issued
12 reports with recommendations for improving Agency operations,
reducing fraud and unnecessary losses, and recovering funds. OIG
investigations led to 26 indictments and 22 convictions of subjects
who defrauded the Federal Government. In addition, the Office collectively
reviewed 77 legislative, regulatory, policy, procedural, and other
proposals concerning the SBA and Government-wide programs.
SBA OIG AUDIT REPORT 5-20
| AUDIT OF THE CONTRACT BUNDLING PROCESS | May
20, 2005
http://www.sba.gov/idc/groups/public/documents/sba/oig_reptbydate_05-20.pdf
Summary: The Office of Inspector General (OIG) completed
an audit survey of the contract bundling process to determine whether
the Small Business Administration (SBA) is properly receiving and
reviewing all bundled contracts. We found significant problems with
the SBA’s ability to obtain and track bundlings.
Top of Page
GAO-05-459 | DEPARTMENT
OF ENERGY – IMPROVED OVERSIGHT COULD BETTER ENSURE
OPPORTUNITIES FOR SMALL BUSINESS SUBCONTRACTING
| May 13, 2005
http://www.gao.gov/new.items/d05459.pdf
Summary: DOE’s facility management contractors’ small
business subcontracting achievements—reported as a percentage of
their total subcontracted dollars—are not useful for monitoring purposes
because the reported data overstates subcontracting achievements.
SBA OIG REPORT 5-16 | REVIEW
OF SELECTED SMALL BUSINESS PROCUREMENTS | March
8, 2005
http://www.asbl.com/documents/05-16.pdf
Summary: A review of the propriety of small business
certifications and whether certain contractors who received small
business contracts were indeed small.
Top of Page
SBA OIG Report 5-15 | NEW
MANAGEMENT CHALLENGES - LARGE BUSINESSES RECEIVE
SMALL BUSINESS AWARDS | February 24, 2005
http://www.asbl.com/documents/05-15.pdf
Summary: As the advocate for small business, the
Small Business Administration (SBA) should strive to ensure that
only small firms obtain small business awards and agencies only receive
small business credit for awards to small firms. Too often, however,
this is not the case.
SBA OIG Report 5-14 | SBA
SMALL BUSINESS PROCUREMENT AWARDS ARE NOT ALWAYS
GOING TO SMALL BUSINESSES | February 24, 2005
http://www.asbl.com/documents/05-14.pdf
Summary: The Office of Inspector General (OIG) conducted
an evaluation to determine whether small business procurement awards
reported by the Small Business Administration (SBA) in Fiscal Years
(FY) 2001 and 2002 were indeed awarded to companies that were small
at the time of the award.
Top of Page
EAGLE EYE PUBLISHERS
| Prepared for the SBA | ANALYSIS OF TYPE-OF-BUSINESS
CODING FOR THE TOP 1,000 CONTRACTORS RECEIVING
SMALL BUSINESS AWARDS IN FY 2002 | December 2004
http://www.sba.gov/advo/research/rs246tot.pdf
Summary: A review of the transaction records coded
as being awarded to small businesses in the Individual Contract Action
Report (ICAR) file identified large vendors as some of the actual
recipients.
GAO-03-704T | TESTIMONY
BEFORE THE COMMITTEE ON SMALL BUSINESS, HOUSE
OF REPRESENTATIVES | May 7, 2003
http://www.gao.gov/new.items/d03704t.pdf
Contract Management: Reporting of Small Business Contract Awards
Does Not Reflect Current Business Size
Summary: According to FPDS, five large companies
that the GAO reviewed received contracts totaling $1.1 billion in
fiscal year 2001, including $460 million as small business awards.
SBA OIG SEMI-ANNUAL
REPORT | September 1995
http://www.asbl.com/documents/SBA_OIG_Sem-annual_sept_1995.pdf
Summary: OIG audits, inspections, and investigations
during this 6-month period achieved $27,391,466 in potential dollar
results, 31 indictments, and 27 convictions.
Top of Page
For
a back-up list of federal investigations and
private studies on the diversion of federal
small business contracts to large corporations
documents, please click
here
|
|
|
|
|
|
|
|
|
Video:
ASBL President Lloyd Chapman with CNN's Lou Dobbs
|
Press
Contacts
Reid Brownlie
Communications Director
American Small
Business League
3910 Cypress Dr., Suite B
Petaluma, CA 94954
707-789-9528 | fax
707-789-9580
email to rbrownlie@asbl.com
|