Ineligible contractors getting $500M a year from VA

Ineligible contractors getting $500M a year from VA, OIG says
Federal auditors found programs for vet-owned and disabled-vet-owned companies rife with problems

By Alice Lipowicz
Aug 02, 2011
Federal auditors took a hard look at procurement practices at the Veterans Affairs Department in two new reports, finding that VA is likely to be awarding about $500 million a year to ineligible contractors.

In a July 25 audit, investigators evaluated the veteran-owned small business (VOSB) and the service-disabled veteran-owned small business programs (SDVOSB), which together generated about $3.5 billion in procurements in fiscal 2010, or about 23 percent of total VA procurements.

The inspector general’s office reviewed 42 “statistically-selected” contracts in those two programs with a total value of $46.5 million that had been awarded to businesses alleged to be eligible for those programs. The review found that 32 of the businesses were ineligible to participate in the programs or were ineligible for the specific contracts they were awarded.

Based on that analysis, the inspector general’s office forecasted the total impact of contracts in those programs awarded to businesses that are ineligible for those programs.
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Ineligible contractors getting $500M a year from VA