Auditors See Weaknesses in VA Verification Program Staff shortages and poor controls have led to “weaknesses” in the Veterans Affairs Department’s efforts to verify the eligibility of veteran-owned businesses, the Government Accountability Office reported. GAO found that VA has verified the eligibility of only 14% of the 20,000-plus businesses that are registered in its database of veteran-owned firms. VA acknowledged that the backlog of applications is growing. In May VA said its OSDBU, which runs the verification program through its Center for Veterans Enterprise, had 10 vacant positions out of 40 that were authorized. The OSDBU director’s position was vacant for more than a year until a new one came aboard in February. Beyond the backlog of companies awaiting verification, GAO said many of the files on companies that have been verified were missing key documentation to explain how VA determined that they were veteran-owned or service-disabled veteran-owned. GAO said 150 companies have been denied verification, but the department has no procedure to notify its contracting officers when a business is denied. Nor has it referred any of the companies for possible suspension or debarment procedures. “Without timely improvements to [the Center for Veterans Enterprise’s] data systems and controls in place to ensure the completeness and accuracy of information, the verification program remains at higher risk for error, lacks quality control, and makes it difficult to know whether eligibility requirements were met,” the auditors said. Companies are allowed to register in VA’s Vendor Information Pages database and self-certify their eligibility for veterans’ preferences. VA is required to verify eligibility, and will begin awarding contracts only to verified companies in 2012. Currently VA and all other federal agencies accept self-certification. Last year GAO found widespread evidence of fraud and abuse in the service-disabled veterans contracting program. Veterans’ organizations have complained about slowness and unresponsiveness in the Center for Veterans Enterprise. At a March congressional hearing an American Legion official reported “a great deal of anger” toward the center. VA officials said they are moving to fill staff vacancies and have hired a contractor to conduct site visits to verify eligibility, though not all companies will be visited. While all agencies may set aside contracts for service-disabled veterans, only VA awards set-aside contracts to any veteran-owned small business. In 2009 the department reported 19.7% of its prime contract dollars went to veteran-owned firms, and 16.7% to SDVs. But awards to woman-owned and HUBZone businesses have fallen in the past three years since the veterans’ set-asides began.