Mentor-Protege Program Fraud: Contractor Agrees to $1.15 Million Settlement

Posted on April 5, 2013 by Steven Koprince

An Alabama-based construction company has agreed to pay more than a million dollars to settle allegations that it violated the False Claims Act by fraudulently representing that it was mentoring a minority-owned small business under the Department of Defense’s mentor-protege program.

The settlement puts to rest the Justice Department’s False Claims Act contention that the contractor used its so-called “protege” as little more than a pass-through entity and failed to provide real mentoring services to the small business.

HUBZone Certification Not Required At Solicitation Issuance, Says GAO

Posted on April 4, 2013 by Steven Koprince

A Treasury Department solicitation did not require contractors to be certified HUBZone participants at the time the solicitation was issued, despite language in the solicitation arguably requiring just that in order to receive a high rating for socioeconomic status.

In a recent GAO bid protest decision, the GAO held that the agency properly interpreted the solicitation to require HUBZone certification at the time proposals were due, not the time the solicitation was issued. The GAO’s ruling comports with the HUBZone program regulations, which do not require contractors to be certified at the time a solicitation is issued in order to be considered HUBZone participants for purposes of that solicitation.

Contractor Misses Solicitation’s Past Performance Requirement; Gets High Score Anyway

Posted on April 2, 2013 by Steven Koprince

A contractor was awarded an “Excellent” past performance score despite submitting only three past performance references, not the five past performance references required by the solicitation.

Although one might think that a contractor would be penalized for failing to satisfy such a requirement, the GAO held that the procuring agency properly gave the contractor in question a high past performance score, based on the three submitted references and past performance information obtained from other sources.

SBA OHA: Contractor Successfully Fractured Economic Dependence Affiliation

Posted on April 1, 2013 by Steven Koprince

A contractor is not economically dependent upon another firm where it receives only a small proportion of its revenues from the other firm as of the self-certification date for a set-aside contract–even if the contractor previously received more than 70% of its annual revenues from the other firm.

This was the commonsense decision of the SBA Office of Hearings and Appeals in a recent size appeal case, in which SBA OHA held that a contractor’s prior economic dependence on another company does not necessarily mean that the companies are still affiliated under the SBA’s affiliation rules.

SDVOSB Fraud: DOJ Alleges Non-SDVs Received $13 Million

Posted on March 21, 2013 by Steven Koprince

Two brothers fraudulently misrepresented themselves to be service-disabled veterans and received $13 million in VA SDVOSB set-aside awards, according to a U.S. Department of Justice press release.

The brothers, Raymond Testa and Gerald Testa, both of New York, were recently arrested and charged with major wire fraud. If convicted, they face penalties of up to 10 years in prison and/or a fine of up to $1 million.

VA CVE: SDVOSB Reconsiderations Taking 128 Days

Posted on March 19, 2013 by Steven Koprince

Did your company file a request for reconsideration of a VA CVE SDVOSB verification denial? If so, be prepared to wait awhile–approximately 128 days, according to a recent VA CVE email.

The email, which was sent to a number of SDVOSBs and VOSBs (and kindly shared with me) indicates that the VA CVE is currently processing approximately 300 requests for reconsideration. As a result, the VA CVE says, the time frame to process a request for reconsideration is now more than double the regulatory goal of 60 days.