GAO Stings HUBZone Program—Again Remember the Alamo? The Small Business Administration doesn’t. The Government Accountability Office says SBA approved a nonexistent company for the HUBZone program even though the company listed its address as the Alamo in San Antonio, TX. GAO named the phony company Crockett and Associates after one of the heroes of the Alamo battle, Davy Crockett. Crockett was one of four fake firms GAO created to apply for HUBZone certification in its latest investigation of the program. Three of them won certification, including two that registered their addresses at a public storage facility in Florida and a city hall in Texas. The head of GAO’s investigative unit, Gregory Kutz, said “a simple Internet search” would have exposed the fraudulent addresses. GAO said SBA repeatedly lost documents submitted by the fourth company, so it was never certified. The latest GAO sting was a follow-up to previous investigations in 2008 and 2009 that found the HUBZone program wide open to fraud and abuse because of SBA’s poor supervision. Those investigations found that companies used “virtual offices” such as mail drops and fake business locations to qualify for HUBZone status. At a July 28 hearing of the House Small Business Committee, SBA Administrator Karen Mills said the agency has tightened its application process to require “more stringent documentation” from applicants, including a sworn statement. But Kutz said SBA did not verify the authenticity of fake documents such as tax returns and utility bills. “We are better than we were,” Mills testified. “We’re not there yet.” In its prior investigations GAO identified 29 HUBZone companies that appeared to be ineligible. Mills said SBA has decertified 16, eight voluntarily dropped out and five were found to be eligible. However, GAO found that the 29 firms received an additional $66 million in contracts after the auditors’ report was released. Mills also said SBA has stepped up site visits to HUBZone companies. The agency plans to conduct 1,000 visits this year, up from fewer than 100 in 2008. But Mills said the visits concentrate on companies that have already received large HUBZone contracts, not new entries into the program. With SBA citing progress while auditors continue to find the same problems, committee Chairwoman Nydia Velazquez complained, “There is a web of double-talk here.” Velazquez estimated that it would take just 77-and-a-half man-hours to use Google Earth to verify the addresses of all 9,300 companies in the HUBZone program.