PETALUMA, Calif., January 31, 2006 /PRNewswire/ -- The most recent report to Congress from the Small Business Administration's Office of Inspector General has recommended debarment of a major government contractor for "misrepresenting that it was a small business concern in obtaining a Government contract which was set-aside for a small business." As of today, the SBA has taken no action against the contractor. In addition, the agency has refused to release the name of the firm.

Section 16(d) of the Small Business Act makes it a criminal offense to misrepresent in writing the status of any concern as a "small business concern" in order to obtain for oneself or another any prime contract. Violations of 16(d) are punishable by a fine of not more than $500,000 or by imprisonment for not more than ten years or both, and can result in certain administrative remedies, including suspension and debarment.

The report also cites additional occurrences of fraud. In one, an employee of the SBA allegedly used his position to obtain over $20,000 for his personal benefit in exchange for funneling $3 million in contracts to an 8 (a) contractor. The employee has been indicted. The other case involved company officers making misrepresentations to the SBA in order to maintain their 8(a) eligibility status. The officers were indicted and pled guilty.

The SBA has been widely criticized for refusing to take any action to address what some critics believe to be widespread fraud and abuse in Federal small business contracting. As early as 1995, the SBA's Office of Inspector General discovered fraud in contracting programs. During a recent investigation in 2005, it was revealed that large firms were guilty of false certifications to illegally receive Federal small business contracts.

Furthermore, the SBA's own Office of Advocacy released a study in 2005 that found "vendor deception" as one of the reasons why billions of dollars in small business set-asides were actually diverted to large businesses.

In spite of the evidence of fraud presented seven government investigations, SBA Administrator Hector Barreto continues to deny the existence of any wrongdoing. In a recent interview with the Dallas Morning News, Mr. Barreto stated, "There has been some criticism that large companies get contracts that were meant for small businesses, and we disagree with that. There are a lot of protections in place, and if that were happening, there would be serious repercussions for that big company."

"I think House Representative Nydia Velasquez hit it right on the head when she accused Barreto of being dishonest during a Congressional hearing," stated Lloyd Chapman, President of the American Small Business League. "I think it's time for the Justice Department to launch an investigation to get to the bottom of this and find out how many more companies are guilty of contract fraud and how many government employees are involved or trying to cover it up. It's an outrage that the SBA's Inspector General has documented fraud in small business contracting for ten years and nothing is being done to stop it."

About the ASBL
The American Small Business League was formed to promote and advocate policies that provide the greatest opportunity for small businesses - the 98% of U.S. companies with less than 100 employees. The ASBL is founded on the principle that small businesses, the backbone of a vital American economy, should receive the fair treatment promised by the Small Business Act of 1951. Representing small businesses in all fields and industries throughout the United States, the ASBL monitors existing policies and proposed policy changes by the Small Business Administration and other federal agencies that affect its members.

PETALUMA, Calif., January 31, 2006 /PRNewswire/ -- The Bush-appointed Civil Rights Commission recently issued a report that said that the Federal government is doing too much business with minorities and needs to cut back. The conservative think tank, the American Enterprise Institute, published a study that stated that the SBA should be closed and all Federal small business programs should be eliminated. Last year, the U.S. Women's Chamber of Commerce was forced to sue the Small Business Administration in order to get them to implement the federally mandated women's procurement program.

In a recent speech, President Bush referred to the SBA as a "small agency" that was "overwhelmed" by the Hurricane Katrina disaster. What he failed to mention was that over the last few years, he has cut the SBA budget and the staffing in half. In fact, the agency had to hire thousands of temporary employees to manage the workload left by the experienced personnel who have been laid off or forced into early retirement.

Lloyd Chapman, President of the American Small Business League, predicts that the Bush administration plans to close the SBA in 2006. "When the Republicans do this, you can bet that they are going to eliminate this agency under the guise that it will be beneficial for small businesses. But I can assure you that they don't have any intention of doing anything that will be good for small business. This administration has a track record of passing policies that have diverted billions of dollars in contracts from small businesses. Don't take my word for it, look at the seven Federal investigations that have come out in the last three years that show that billions of dollars in Federal small business contracts have been awarded to large companies."

Report 5-15 from the SBA's Office of Inspector General states that, "One of the most important challenges facing the Small Business Administration and the entire Federal government today is that large businesses are receiving small business procurement awards and agencies are receiving credit for these awards."

Chapman added, "I wouldn't be surprised if, tomorrow night during his State of the Union address, Bush tries to pitch the idea of closing the SBA and rolling it into the Commerce Department. He will try to convince us that this will be good for the small business community, but nothing could be further from the truth. What he really wants to do is close the SBA and eliminate Federal contracting programs for small business, women, and minorities."

About the ASBL
The American Small Business League was formed to promote and advocate policies that provide the greatest opportunity for small businesses - the 98% of U.S. companies with less than 100 employees. The ASBL is founded on the principle that small businesses, the backbone of a vital American economy, should receive the fair treatment promised by the Small Business Act of 1951. Representing small businesses in all fields and industries throughout the United States, the ASBL monitors existing policies and proposed policy changes by the Small Business Administration and other federal agencies that affect its members.

Petaluma, CA, January 25, 2006/PRNewswire/ -- A report by the Civil Rights Commission has recommended eliminating "race-conscious programs." The majority opinion argues that Federal agencies have not implemented practices to ensure that racially based preferences serve a compelling government interest.

The report includes a lengthy dissent by one of the only two democratic members, Michael Yaki, a San Francisco attorney and former city supervisor. Mr. Yaki asserts that the commission majority misconstrues the Supreme Court's decision and "takes a radical step backwards from the race-progressive policies this nation has undertaken" while ignoring pertinent data received from Federal agencies.

The Federal goal for minority contracting is 5%, however, participation in the SBA's 8(a) program has actually declined over the past several years. According to a SBA Office of Advocacy report, the 8(a) program reached a high of 3.7% in 1995 and see-sawed down to 2.8% in 2004, even though the number of minority-owned businesses has steadily grown.

"Although they are small, these programs work," stated Drue Brown, Owner of AgCel, an 8(a) certified business and Chairman of the Sacramento Valley 8 (a) Association. "Our country needs race-conscious programs to make a marginal correction to a national history of discrimination. Without them, there is no way to even the playing field for people of color."

"I think that minority business owners should be up in arms over this," stated Lloyd Chapman, President of the American Small Business League. "The government has never hit the 5% minority business contracting goal and now they're recommending eliminating the minimal opportunities that minorities have in doing business with the Federal government. It's unconscionable."

According to Civil Rights Commissioner Michael Yaki, "It's going to take leaders in the business community such as the American Small Business League to show that the majority views are out of step with mainstream America. I commend the ASBL for their work and I would encourage people to support them."

Members of the Civil Rights Commission are four Bush-appointed republicans, two democrats, and one independent, Abigail Thernstrom, the Vice Chair. Evidence exists that former republican Mrs. Thernstrom changed her party after the president nominated a fifth republican to the Commission. The law prohibits the installation of any more than four members of one party. Five members of the Commission constitute a quorum.

About the ASBL
The American Small Business League was formed to promote and advocate policies that provide the greatest opportunity for small businesses - the 98% of U.S. companies with less than 100 employees. The ASBL is founded on the principle that small businesses, the backbone of a vital American economy, should receive the fair treatment promised by the Small Business Act of 1951. Representing small businesses in all fields and industries throughout the United States, the ASBL monitors existing policies and proposed policy changes by the Small Business Administration and other federal agencies that affect its members.