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The SBA's Office of Inspector General turned up some questionable activity while examining Alaska native corporations.
"Two government contractors designated as small, Alaska-native-owned firms directed millions of dollars in fees to other companies owned by managers who were not Alaska natives and should not have received the payments, according to an audit report by the Office of Inspector General at the Small Business Administration," said a story in today's Washington Post.
The two ANCs in question came on strong over the last several years, securing federal work worth up to $833 million contracts, much of it without any competition. Many of you already know that ANCs -- established three decades ago to help economic development in Alaska and settle native land claims to the federal government -- can win sole-source contracts of any amount.
"The audit report recommended that the two companies -- APM, a construction management company from Yorba Linda, Calif., and Goldbelt Raven, a Chantilly firm that provides acquisitions support, program management and technology services -- be terminated from the agency's 8(a) small business set-aside program," the story said.
Goldbelt Inc., parent of Goldbelt Raven, released a statement. Among other things, it said this:
"We have been, and will continue to be, fully cooperative with the SBA throughout this process. The 8(a) Program is a vital tool for Native entities to be able to provide meaningful benefits to its Native shareholders, through scholarships, employment opportunities, dividends, and other social and economic programs, which Goldbelt Incorporated provides to its 3500 Native shareholders.
"Goldbelt was not given the opportunity to provide comment to be included in the report, so we look forward to responding to each of the findings and clarifying misinformation or misunderstandings. We are now for the first time able to review and assess the IG Report and are taking a very close and careful review of its contents. We take its findings and recommendations very seriously and will be working directly with the SBA to address the report. "
By Robert O'Harrow |
August 13, 2008; 5:35 PM ET
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Posted by: 8(a) program | August 15, 2008 11:49 AM
First posted on Sharon McLoone's blog:
Thank you for providing this information.
But please don't forget Spencer Hsu also reported on similar fraud perpetrated by SAIC, General Dynamics and L-3 in November of 2007.
SAIC, in particular, is notorious for stealing work from small businesses unethically, by first riding in on SBA set-asides, and then smearing and sliming the small business to the Government sponsor. The Government sponsor then awards the full contract back to SAIC, to keep from appearing incompetent for giving it to the small company in the first place. SAIC promises not to tell anyone if they get the contract. Isn't that convenient?
Here are a few relevant quotes from HSU's article.
DHS Erroneously Gives $475 Million Contract to Little-Known Firm
Monday, November 19, 2007
By Spencer S. Hsu
The Washington Post
WASHINGTON -- The Department of Homeland Security improperly awarded a half-billion dollar, no-bid contract in 2003 to a little-known company to maintain thousands of x-ray, radiation and other screening machines at U.S. border checkpoints, incorrectly designating the firm a disadvantaged small business, according to a report by the department's inspector general.
...
The annual revenues of Chenega Technology Services Corp., a firm owned by native Alaskans and based in Fairfax County, Va., were too high to qualify for the nine-year, $475 million contract, the report said.
The report also stated that CBP failed to monitor whether Chenega violated federal regulations that bar it from passing more than half the contract's labor costs to subcontractors such as SAIC and subsidiaries of General Dynamics and L-3 Communications, and that CBP and Chenega disagreed over whether the agency directed the company to subcontract with specific firms.
Posted by: STOP FRAUD | August 15, 2008 1:49 PM
First published on Sharon McLoone's blog:
Thank you for providing this information.
But please don't forget Spencer Hsu also reported on similar fraud perpetrated by SAIC, General Dynamics and L-3 in November of 2007.
SAIC, in particular, is notorious for stealing work from small businesses unethically, by first riding in on SBA set-asides, and then smearing and sliming the small business to the Government sponsor. The Government sponsor then awards the full contract back to SAIC, to keep from appearing incompetent for giving it to the small company in the first place. SAIC promises not to tell anyone if they get the contract. Isn't that convenient?
Here are a few relevant quotes from HSU's article.
DHS Erroneously Gives $475 Million Contract to Little-Known Firm
Monday, November 19, 2007
By Spencer S. Hsu
The Washington Post
WASHINGTON -- The Department of Homeland Security improperly awarded a half-billion dollar, no-bid contract in 2003 to a little-known company to maintain thousands of x-ray, radiation and other screening machines at U.S. border checkpoints, incorrectly designating the firm a disadvantaged small business, according to a report by the department's inspector general.
...
The annual revenues of Chenega Technology Services Corp., a firm owned by native Alaskans and based in Fairfax County, Va., were too high to qualify for the nine-year, $475 million contract, the report said.
The report also stated that CBP failed to monitor whether Chenega violated federal regulations that bar it from passing more than half the contract's labor costs to subcontractors such as SAIC and subsidiaries of General Dynamics and L-3 Communications, and that CBP and Chenega disagreed over whether the agency directed the company to subcontract with specific firms.
Posted by: Stop Fraud | August 15, 2008 1:50 PM
The comments to this entry are closed.
It is pretty ironic that Goldbelt interprets the 8(a) program as a strong subsidy to only 3500 shareholders.
Isn't the 8(a) program supposed to help thousands of small businesses - who then literally employ millions of people? These ANC's aren't small businesses and allowing these billion dollar companies into this 8(a) program is a scam.
Why aren't the true 8(a) businesses screaming their heads off about all this money funneled to the ANC's and their managers?