IG: Tiny Alaska Native Firm Served as Pass-Through The Interior Department has stopped awarding task orders to an affiliate of Alaska Native Corporation Cape Fox after the department’s inspector general found that the 8(a) company was operating as a pass-through. United Solutions and Services, known as US2, was awarded a sole source contract by the Army worth up to $250 million for a variety of services, including developing a campaign to combat sexual assault in the military. The Washington Post reported in November that US2, which is 51% owned by Cape Fox, operated out of an executive’s home and had previously received just $73,000 in federal contracts, most of it for janitorial services. “With the Army’s knowledge, the firm subcontracted the majority of the awarded contract to more established companies,” the IG found. That was a violation of regulations requiring an 8(a) company to do at least 50% of the work. “Despite receiving reports showing that US2 has been non-compliant with 8(a) subcontracting limitations for more than two-and-a-half years, the [contracting officer] did not take effective actions to either correct the problem or terminate the contract for non-compliance,” the IG report said. The department told the Post that it has discontinued awarding task orders. A spokesman for US2 told the Post that the company did what the government asked and, as of June, was complying with the 50% rule. The IG’s audit was part of its report on operations at the Interior Department’s contracting office in Sierra Vista, AZ. The report documented widespread problems in the office and recommended that Interior consider shutting it down. GTSI, Eyak Part Ways GTSI Corp. has divested itself of its interest in Eyak Technology LLC after the close relationship between the two companies landed them in trouble last year. Eyaktek is owned by Eyak Corp., an Alaska Native Corporation. Both GTSI and an Eyaktek subsidiary, EG Solutions, were temporarily suspended from federal contracting last fall. SBA alleged that GTSI used EG as a front to obtain small business contracts. (SAA, 12/3/10) GTSI announced it will receive $20 million in settlement of its disputes with Eyaktek.