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Small Business Advocate Claims Trillion-Dollar Fraud In Government Contracting

Central Valley Business Times
June 18, 2017

American taxpayers are being bamboozled by their government to the tune of at least a trillion dollars, says a small business advocate and long-time critic of the Small Business Administration.

Lloyd Chapman, founder of the American Small Business League, says even without full disclosure by the government, the SBA’s own figures point to something rotten in government contracting.

“I think we’re going to uncover … trillions in fraud,” Mr. Chapman says. “Not millions, not billions, but trillions.”

He says data from the Congressional Budget Office and the Federal Procurement Data System indicate the Small Business Administration falsified the federal government's compliance with the 23 percent small business contracting goal for fiscal year 2016.

Mr. Chapman points to a May 18 press release in which the SBA claimed small businesses had received $99.96 billion in federal contracts and 24.34 percent of all federal contracts awarded in fiscal year 2016.

The Small Business Act mandates small businesses receive a minimum of 23 percent of all federal contracts.

Here’s where Mr. Chapman’s arithmetic differs from the SBA’s: The Congressional Budget Office reports the total federal acquisition budget for 2016 was $1.2 trillion.

He says 23 percent of the $1.2 trillion the federal government actually awarded in contracts for fiscal year 2016 would be approximately $276 billion.

To reach its number, the SBA had to exclude $790 billion in federal contracts from their calculations, Mr. Chapman says.

Mr. Chapman says the only way to get the federal government to listen seems to be to clonk it over the head with federal lawsuits – which he has done numerous times.

“I’ve got a trial against the Pentagon [on] December 11 of this year,” he says of his latest lawsuit. He contends that much of the tax dollars supposedly going to small business has actually been funneled into large corporations and even foreign firms, including a Russian arms seller.

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