Click here to close now.


News Feed Item

New SBA "Safe Harbor" Policy Could Cheat Small Businesses Out Of Billions

American Small Business League (ASBL) announces public comment period ending soon

PETALUMA, Calif., Aug. 18, 2014 /PRNewswire-USNewswire/ -- The Small Business Administration (SBA) is taking public comment on a new policy that would create a "safe harbor from fraud penalties" for large businesses that misrepresent themselves as small businesses to illegally receive federal small business contracts.

ASBL announces SBA refusing to release records under FOIA

Under section 16 (d) of the Small Business Act, the penalty for large businesses that misrepresent themselves to illegally land federal small business contracts is up to 10 years in prison. If the SBA "safe harbor" policy is adopted, large businesses that are caught committing fraud can simply claim they "acted in good faith" and avoid any penalties.  Legitimate small businesses could lose billions of dollars a year in federal contracts as the penalties for hijacking federal small business contracts are essentially removed.

Every year for a decade the SBA Office of Inspector General has named the diversion of federal small business contracts to large businesses as the number one problem at the SBA. The SBA has consistently refused to adopt any policies to halt the rampant fraud.

The SBA even denied the widely reported fraud calling it a "myth" in a 2006 press release titled "Myth vs. Fact".

NBC, ABC, CBS, CNN, MSNBC, Fox and CNBC have all reported on the fraud and abuse at the SBA.

As early as 1995 the SBA Inspector General uncovered that large businesses were misrepresenting themselves as small businesses to illegally land federal small business contracts.

In 2003 an investigation by the Government Accountability Office (GAO) found over 5,000 large businesses were receiving federal small business contracts.

A 2005 investigation by the SBA Inspector General found large businesses were committing contracting fraud by making "false certifications" and "improper certifications".

Report 5-14 from the SBA Inspector General found the SBA was reporting awards to large businesses as small business awards in it's own procurements. One of the firms the SBA reported as a small business was Buhrmann NV, a firm located in Holland with over 26,000 employees around the world in 28 countries.

An investigation by the General Accounting Office essentially accused the SBA of encouraging fraud. GAO Report 10-108 stated, "By failing to hold firms accountable,  SBA and contracting agencies have sent a message to the contracting community that there is no punishment or consequences for committing fraud…"

Even President Obama recognized the fraud at the SBA when he stated, "It is time to end the diversion of federal small business contracts to corporate giants."

Individuals can send comments to the SBA on the "safe harbor from fraud penalties" policy by going the proposed rule on the Federal Register website and clicking on "Submit a formal comment" in the upper right hand corner. The comment period will end on Monday, August 25.

Logo -

SOURCE American Small Business League

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
Any Ops team trying to support a company in today’s cloud-connected world knows that a new way of thinking is required – one just as dramatic than the shift from Ops to DevOps. The diversity of modern operations requires teams to focus their impact on breadth vs. depth. In his session at DevOps Summit, Adam Serediuk, Director of Operations at xMatters, Inc., will discuss the strategic requirements of evolving from Ops to DevOps, and why modern Operations has begun leveraging the “NoOps” approa...
DevOps is here to stay because it works. Most businesses using this methodology are already realizing a wide range of real, measurable benefits as a result of implementing DevOps, including the breakdown of inter-departmental silos, faster delivery of new features and more stable operating environments. To take advantage of the cloud’s improved speed and flexibility, development and operations teams need to work together more closely and productively. In his session at DevOps Summit, Prashanth...
SYS-CON Events announced today that Sandy Carter, IBM General Manager Cloud Ecosystem and Developers, and a Social Business Evangelist, will keynote at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA.
SYS-CON Events announced today that Super Micro Computer, Inc., a global leader in high-performance, high-efficiency server, storage technology and green computing, will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Supermicro (NASDAQ: SMCI), the leading innovator in high-performance, high-efficiency server technology is a premier provider of advanced server Building Block Solutions® for Data ...
SYS-CON Events announced today that Machkey International Company will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Machkey provides advanced connectivity solutions for just about everyone. Businesses or individuals, Machkey is dedicated to provide high-quality and cost-effective products to meet all your needs.
The modern software development landscape consists of best practices and tools that allow teams to deliver software in a near-continuous manner. By adopting a culture of automation, measurement and sharing, the time to ship code has been greatly reduced, allowing for shorter release cycles and quicker feedback from customers and users. Still, with all of these tools and methods, how can teams stay on top of what is taking place across their infrastructure and codebase? Hopping between services a...
As the world moves towards more DevOps and microservices, application deployment to the cloud ought to become a lot simpler. The microservices architecture, which is the basis of many new age distributed systems such as OpenStack, NetFlix and so on, is at the heart of Cloud Foundry - a complete developer-oriented Platform as a Service (PaaS) that is IaaS agnostic and supports vCloud, OpenStack and AWS. In his session at 17th Cloud Expo, Raghavan "Rags" Srinivas, an Architect/Developer Evangeli...
As-a-service models offer huge opportunities, but also complicate security. It may seem that the easiest way to migrate to a new architectural model is to let others, experts in their field, do the work. This has given rise to many as-a-service models throughout the industry and across the entire technology stack, from software to infrastructure. While this has unlocked huge opportunities to accelerate the deployment of new capabilities or increase economic efficiencies within an organization, i...
As a CIO, are your direct reports IT managers or are they IT leaders? The hard truth is that many IT managers have risen through the ranks based on their technical skills, not their leadership ability. Many are unable to effectively engage and inspire, creating forward momentum in the direction of desired change. Renowned for its approach to leadership and emphasis on their people, organizations increasingly look to our military for insight into these challenges.
SYS-CON Events announced today that DataClear Inc. will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. The DataClear ‘BlackBox’ is the only solution that moves your PC, browsing and data out of the United States and away from prying (and spying) eyes. Its solution automatically builds you a clean, on-demand, virus free, new virtual cloud based PC outside of the United States, and wipes it clean...
Containers are all the rage among developers and web companies, but they also represent two very substantial benefits to larger organizations. First, they have the potential to dramatically accelerate the application lifecycle from software builds and testing to deployment and upgrades. Second they represent the first truly hybrid-approach to consuming infrastructure, allowing organizations to run the same workloads on any cloud, virtual machine or physical server. Together, they represent a ver...
As operational failure becomes more acceptable to discuss within the software industry, the necessity for holding constructive, actionable postmortems increases. But most of what we know about postmortems from "pop culture" isn't actually relevant for the software systems we work on and within. In his session at DevOps Summit, J. Paul Reed will look at postmortem pitfalls, techniques, and tools you'll be able to take back to your own environment so they will be able to lay the foundations for h...
SYS-CON Events announced today the Containers & Microservices Bootcamp, being held November 3-4, 2015, in conjunction with 17th Cloud Expo, @ThingsExpo, and @DevOpsSummit at the Santa Clara Convention Center in Santa Clara, CA. This is your chance to get started with the latest technology in the industry. Combined with real-world scenarios and use cases, the Containers and Microservices Bootcamp, led by Janakiram MSV, a Microsoft Regional Director, will include presentations as well as hands-on...
As more intelligent IoT applications shift into gear, they’re merging into the ever-increasing traffic flow of the Internet. It won’t be long before we experience bottlenecks, as IoT traffic peaks during rush hours. Organizations that are unprepared will find themselves by the side of the road unable to cross back into the fast lane. As billions of new devices begin to communicate and exchange data – will your infrastructure be scalable enough to handle this new interconnected world?
"Matrix is an ambitious open standard and implementation that's set up to break down the fragmentation problems that exist in IP messaging and VoIP communication," explained John Woolf, Technical Evangelist at Matrix, in this interview at @ThingsExpo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.