A New Jersey woman has been arrested and charged with procurement fraud for allegedly falsely certifying that her company was a SDVOSB.
According to a Department of Justice press release, Miriam Friedman falsely claimed that her father-in-law, a retired veteran, owned and operated the business. According to the DOJ, Friedman’s father-in-law not only had minimal involvement in the business, but is not service-disabled.
A would-be SDVOSB’s relationships with a company controlled by the SDVOSB’s minority owner undermined the service-disabled veteran’s control–and cost the SDVOSB an Air Force contract.
In a recent decision, the SBA Office of Hearings and Appeals ruled that a SDVOSB did not adequately control his company where the company (and the veteran) appeared to be unduly dependent on an outside firm.
The SBA will “make it a priority” to adopt regulations establishing mentor-protege programs for SDVOSBs, HUBZones, and WOSBs in the next 12 months, according to the SBA’s most recent semiannual regulatory agenda.
The regulatory agenda states that the three new mentor-protege programs are expected to be “similar” to the 8(a) mentor-protege program, which suggests that the special joint venturing benefits currently available only to 8(a)s may become available to SDVOSBs, HUBZones and WOSBs, as well.
A SDVOSB was not required to inform a procuring agency that the service-disabled veteran owner had passed away following submission of the SDVOSB’s proposal, according to a recent decision of the U.S. Court of Federal Claims.
In NEIE, Inc. v. United States, No. 13-164 C (2013), the Court sharply criticized the U.S. Environmental Protection Agency for unjustifiably maintaining that the SDVOSB in question was required to inform the EPA of the veteran’s death, even though there is no such requirement in the regulations and the veteran’s death had no impact on the SDVOSB’s contract eligibility.
The NEIE case is not only a good reminder of when a SDVOSB must be eligible to receive a non-VA SDVOSB set-aside (typically, at the time of the initial priced offer), but a troubling example of an over-zealous procuring agency misinterpreting and misapplying the SDVOSB regulations to the detriment of an eligible SDVOSB.
Perhaps no single aspect of federal government contracting causes more confusion than the fact that the government currently runs two SDVOSB programs: one under the VA’s rules and the other under the SBA’s.
The current system can lead to inconsistent results, such as a company being a “SDVOSB” for purposes of VA contracts, but not those issued by other agencies (or vice versa). As SmallGovCon readers know, I am on record as stating that the “two SDVOSB programs” approach is idiotic and ought to be scrapped. (Okay, maybe I wasn’t on record with the word “idiotic” before. I guess I am now.)
But while I cross my fingers and hope that Congress will simplify things, SDVOSBs are stuck with the current system. And, as a recent SBA Office of Hearings and Appeals case demonstrates, SDVOSBs should be aware of the important differences between the two SDVOSB programs.
In the movies, the heroes are often loud and brash. But in real life, the heroes I know are, almost without fail, extraordinarily modest.
Veterans don’t tend to boast about their accomplishments on the battlefield, and they don’t expect sympathy for the sacrifices they made. Instead, they pursue their post-military careers with the same work ethic, determination and honor that are hallmarks of our military. It is little wonder that many of my most successful clients are veteran-owned small businesses.
Veterans are extraordinarily modest. They don’t ask for, or expect, a “thank you.” But that doesn’t mean they don’t deserve one. If you are a veteran, thank you very much for your service. If you are not a veteran, take a moment today to thank the veterans in your life.
To all, Happy Veterans Day.
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