A federal program set up to steer $4 billion in government contracts to businesses owned by disabled military veterans has allowed more than $90 million in contracts to be fraudulently obtained by ineligible companies, according a report released Thursday.
The U.S. General Accounting Office, which produced the report, said it chose 10 cases to study from more than 100 allegations of fraud. It found that none of the companies was eligible for contracts, and yet they received a total of $93.2 million.
Among them was a company doing maintenance on trailers housing victims of Hurricane Katrina. None of the 10 were in Virginia.
The report criticized the Service-Disabled Veteran-Owned Small Business program, which is run by the Small Business Administration, for failing to properly check applicants before awarding contracts and for failing to take action on disabled veterans' complaints of abuses. The report was requested by the House Small Business Committee in part because of complaints from vets.
U.S. Rep. Glenn Nye, D- Va., chairman of the House panel's subcommittee on contracting and technology, said he will begin hearings in early December to investigate the contracts.
"I'm steamed," said Nye, who thinks abuses may be widespread given that the GAO found problems in all 10 test cases. "It's one of the things I want to get to the bottom of quickly. We're talking about people who have been disabled in the service and now have been denied a fair shake with these contracts."
Nye, whose 2nd District includes Virginia Beach and most of Norfolk, introduced a bill Thursday that would establish a criminal penalty for anyone who obtains one of the contracts without being a disabled veteran. The bill also would require the SBA agency to create positions responsible for making sure that contractors are legitimate.
It "defies logic," he said, that the agency isn't checking who is getting billions in federal dollars.
Nye said the GAO findings aren't a surprise to many disabled veterans who have complained to him.
Elton Roller Jr., a disabled Air Force veteran who owns a five-person construction business in Hampton, said his complaints fell on deaf ears. "Some of these guys are flat out lying," said Roller, who has talked to Nye.
Roller said that when he applied recently for a $3 million federal contract, he alerted federal officials that another bidder did not meet the disability requirements. His complaint was ignored and the ineligible bidder was given the work, Roller said.
Bill Bartel, (757) 446-2398, bill.bartel@pilotonline.com
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Pilot correction
Note to the Pilot: The agency changed its name a few years ago. It's no longer the General Accounting Office, but rather the Government Accountability Office.
Thanks For Hearings Glenn
Can you call up a couple of the business owners that got the money improperly and find the faults in the process?
I believe they are the experts.
"Nye, whose 2nd District . . . . .
introduced a bill Thursday that would establish a criminal penalty for anyone who obtains one of the contracts without being a disabled veteran."
While I thank Rep. Nye for trying to do right by vets, I'm pretty sure there are already sufficient penalties for lying on federal forms. Seems to me all that needs done is dispatch the lawmen to serve the subpoenas.
Agree wholeheartedly with the posters who keep asking: "And you want this bunch of thieves/incompetents running your healthcare?"
Vets Left Out
No new news. Veterans do not qualify for loans designed for them and U.S. citizens do not deserve needed health care, because of the cost, although we can crash a rocket into the moon to find water, we don't need, at a cost of $79 million dollars.
Unintended consequences.
A travesty, no doubt.
A surprise? Certainly not.
This is what happens when the naive, well-intentioned system attempts to set aside a slice of the pie for a "special" group.
There are clever culprits out there who will figure out ways to "beat the system" faster than the bureaucracy can plug the holes.
The same thing has been going on with the minority business contracting for years.
More stringent oversight and STIFF penalties and forfeitures for those who are caught can help keep it down to a dull roar.
What's new?
The U.S. General Accounting Office, which produced the report, said it chose 10 cases to study from more than 100 allegations of fraud. It found that none of the companies was eligible for contracts, and yet they received a total of $93.2 million."
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10 out of 10....wonderful record!
What a horrible way to treat our Disabled Vets!!!
Same as the fraudulent job numbers published from Stimulus money.
Government run healthcare = disaster & financial ruin for America!
And they may vote Saturday? :(
(I'm sure they have all read the 2074-page Reid health care reform bill.)
Preach on!
I need say nothing, preach on.
More tricks..
The Government "numbers game" with Pelosi-Reid care!
Nov. 20, 2009
ORRIN HATCH: "They estimate, $849 billion. Well, it's over 10 years, except they don't count the first four years and maybe even the first five years. So the fact of the matter is, it's a budgetary gimmick to get it below a trillion dollars, when, in fact, if you count the full 10 years, it's $2.5 trillion.
But this is just fraud. It's a fake. And I can tell you right now, it's a terrible bill."
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We better pray that more Representatives will get out their dusty calculators?