GSA IG backlash

Industry members are questioning the findings of a recent report by the General Services Administration’s Office of Inspector General as being too heavy-handed.

The IG accused GSA managers of improperly intervening in negotiations with three federal supply schedule contractors (See 6/14/13 issue). Multiple sources said the GSA put Warren Blankenship, division director of IT schedule operations, on administrative leave as a result of the report, according to Federal News Radio.

But some industry members suggest the report missed crucial nuances and systemic problems related to complex schedules negotiations. As a result, it could set a bad precedent.

“Unfortunately (the report) is not the end of the story but merely the prelude to more concerns,” Barbara Kinosky and Jim Phillips, attorneys with Centre Law Group LLC, wrote in a blog entry. “What concerns you might ask? Simply the fear that experienced GSA managers will refrain from providing their advice and assistance in resolving disagreements on difficult Schedule negotiations.

“This report will have a huge chilling effect,” another industry member told Federal News Radio.

More information: IG report: http://goo.gl/z6vAE
Federal News Radio article: http://goo.gl/2b8Uh
Centre Law blog entry (must register): http://goo.gl/ZSgVK

8(a) fraud cases

Keith Hedman, an Arlington, VA security contractor, was sentenced to six years in jail for setting up a shell 8(a) company to win federal contracts meant for minority-owned small companies.

Hedman’s fraud netted him $31 million in contracts with NASA, the Coast Guard and other agencies, and he personally gained $1.5 million, the Washington Post reported.

Seven others have pleaded guilty, and Joseph Richards received a two year prison term and David Lux, one year.

In another case, Vernon Smith III and Georgia Smith of Edgewater, MD, owners of Platinum One Contracting construction company, were arrested and accused of fraudulently obtaining more than $50 million in government contracts. The Smiths allegedly made false representations to participate in the SBA’s 8(a) program.

Debarment guidance

Little guidance is available for the federal contractor suspension and debarment system, according to speakers at a House Government and Oversight Committee hearing.

“You won’t find anywhere in the U.S. code other than a note in the financial chapter,” Project on Government Oversight General Counsel Scott Amey said. “That’s part of the problem. We created a system, but did not supply guidance on how it should operate.”

The Interagency Suspension and Debarment Committee is supposed to coordinate, but agencies aren’t required to work with the committee.

The Defense Logistics Agency, Navy, General Services Aadministration and Immigration and Customs Enforcement have developed their own guidance documents.

Rung’s new role

Anne Rung, GSA’s current chief acquisition officer, also will serve as associate administrator for the agency’s Office of Governmentwide Policy.