GovCon Insights October 7, 2011: Hill Hearings on Suspension and Debarment, Small Business Fraud, Rebate Schemes on Food Contracts

3 keys to good suspension and debarment programs [Federal Computer Week] – Bill Woods, director of acquisition and sourcing management at the Government Accountability Office, told the House Technology, Information Policy, Intergovernmental Relations and Procurement Reform Subcommittee yesterday that agencies with the best suspension and debarment programs have dedicated resources, detailed policies and procedures and an active case referral process. He suggested that Office of Federal Procurement Policy guidance on how to establish active suspension and debarment programs would bring about better enforcement than legislation.

House committee presses SBA about fraud scandal involving EyakTek exec [FedBiz Daily] – Scheduled testimony to the House Small Business Committee by Small Business Administration administrator for government contracting and business development Joe Jordan on challenges facing small business turned into an inquisition on the Eyak Technology contracting scandal. Committee Chair Mick Mulvaney (R-S.C.) wondered whether enough oversight exists for agencies to catch fraud and whether Alaska Native Corporation benefits leave increased potential for issues.

Suspension and debarment could discourage rebate schemes [Government Executive] – Agriculture Department Inspector General Phyllis Fong told the Senate Subcommittee on Contracting Oversight that contractors who use rebates from food manufacturers for large-volume purchasing and leave them off government invoices and pocket the difference should be threatened with suspension or debarment. Charles Tiefer, a former member of the Commission on Wartime Contracting, suggested revising contracts to allow auditors more access and requiring companies to identify any rebates on invoices.

GovCon A to Z: H is for HUBZone Program [GovWin] – The “H” installment in our series highlighting the GovWin knowledge library excerpts from the Historically Underutilized Business Zones (HUBZones) article. Other entries include Homeland Security Department, Hawaii Native-Owned Organizations and Human Resources Professionals.

Hey Panetta, What’s Up With the Waste? [Time Battleland Blog] – Sen. Tom Carper (D-Del.) wrote a letter to Secretary of Defense Leon Panetta suggesting ways to cut waste from the Pentagon budget. He recommended Panetta look into overpaying for spare parts, the fact that the Pentagon inventory system does not allow an order to be changed, cost overruns for major weapon systems and fraud identified by the Commission on Wartime Contracting.

Watchdog group makes Regulations.gov comments more searchable [Federal Computer Week] – Sunlight Labs has created the InfluenceExplorer website to make public comments on proposed federal regulations more searchable.The watchdog wants the public to more easily see special-interest influence on regulations.

Army Shows Off Soldier Smartphone Beta [Danger Room] – The Army unveiled the end user device for its Nett Warrior system to a small group of reporters yesterday. The Android device will not be Wi-Fi enabled and is more of a radio than a phone.

Native Business Leaders Convene in D.C. – Applaud U.S. Attorney’s Office in Prosecution of Employees in Contracting Fraud [Sacramento Bee/PRNewswire] – At its annual member meeting, the Native American Contractors Associationexpressed support for punishing bad actors in federal contracting. Group members must adhere to a strict code of conduct with the knowledge that the bad actions of a few could paint a negative picture of the entire community.

AFCEE contractor goes green with grease [Air Force News Service] – Air Force Center for Engineering and the Environment contractor Leonard Hardy has been running his diesel truck on a a blend of vegetable oil and additives for over six years. He gets the oil from a local Chinese restaurant, friends, neighbors and people from his church.

Tricare data vanishes in downtown car burglary [San Antonio Express-News] – The data breach affecting 4.9 million TRICARE beneficiaries began with backup computer tapes stolen from a SAIC employee’s car in San Antonio while he was moving them from one facility to another. The stereo system and a GPS device were also stolen.

Rep. Issa Questions Obama’s ‘Private Army’ in Iraq, Afghanistan [Wall Street Journal] – Rep. Darrell Issa (R-Calif.) wrote a letter [PDF] to President Obama this week noting that private security contracting has increased under the administration despite poor oversight and cases of fraud. He requested Americans receive more specifics on plansfor hiring 5,100 private security guards in Iraq.

Lockheed to offer F-35 work to Japan firms to win bid [Portfolio.com/Reuters] – Lockheed Martin said yesterday that final assembly, manufacture of major components, maintenance work and engine assembly would be subcontracted to Japanese firms if it wins a bid for F-35s to the government. Its main competitor Boeing said last month that Japanese firms could build three-quarters of the components if the government chose the Super Hornet.

GovCon History
This Day in GovCon History, Oct. 7, 2010: SBA Publishes Final Rule on Women-Owned Small Business (WOSB) Contracting Program [GovWin] – One year ago today, the Small Business Administration issued the final rule creating the women-owned and economically-disadvantaged women-owned small business set-aside programs. Overall, women business owners have been dissatisfied with the amount of contracting opportunities available so far.

Today’s GovCon Cons
Guilty Plea: Sentencing for nuke plant contractor employee [News 13 North Carolina/AP] – Former Williams Specialty Services contractor Matthew Correll pleaded guilty yesterday to falsifying inspection and measurement reports at the Watts Bar Nuclear Plant. He could be sentenced to five years and a $250,000 fine.

Settlement: Oracle will pay government $199.5 million for failing to meet contract [The Hill] – Oracle is paying the General Services Administration $199.5 million to settle a False Claims Act suit that it did not honor the price-reduction clause on a multiple award schedule. The whistleblower, former Oracle employee Paul Frascella, will pocket $40 million.

DOD Contract Announcements
DOD did not list any contract awards for October 6.

Federal Register Updates
Small Business Size and Status Integrity – The Small Business Administration is proposing to:

• Establish a presumption of loss equal to the value of the contract when a concern willfully seeks and receives an award by misrepresentation. 
• Provide that the submission of an offer for an award intended for small business concerns will be deemed a size or status certification or representation in certain circumstances. 
• Provide that an authorized official must sign in connection with a size or status certification or representation for a contract. 
• Ensure that concerns that fail to update their size or status in the Online Representations and Certifications Application (ORCA) database at least annually shall no longer be identified in the database as small or some other socioeconomic status until the representation is updated. 
• Clarify when size is determined for purposes of entry into the 8(a) Business Development and HUBZone programs.