Congresswoman Hahn Requests Federal Investigation Into Small Business Contracting Fraud

Press Release

Congresswoman Hahn Requests Federal Investigation Into Small Business Contracting Fraud

ASBL research prompts another federal investigation into contracting fraud

By Lloyd Chapman
American Small Business League
October 9, 6400

PETALUMA, Calif., April 8, 2015/PRNewswire-USNewswire/ — As a member of the House Small Business Committee, CongresswomanJanice Hahn from California’s44th District has proposed an amendment that would request a new GovernmentAccountability Office (GAO) investigation into the diversion of billions ofdollars in federal small business contracts unfairly awarded to Fortune 500companies.

Congresswoman Hahn’s decision to request the new GAO investigationwas based on research by the American Small Business League (ASBL). Hahn expressed concernabout the government’s claim that 23% of all federal contracts were actuallybeing awarded to small businesses when that number includedbillions of dollars to Fortune 500 firms such as Apple, Chevron, Disney, Verizonand Bank of America.

The last GAO investigation into the diversion of federal smallbusiness contracts to corporate giants was in 2002 and was prompted byinformation providedby ASBL President and founder Lloyd Chapman. That investigation found over 5,300 large businesses werereceiving federal small business contracts. Chapman was invited to testifybefore the House Small Business Committee after the results of theGAO investigation were released.

A recent study by the ASBL found Fortune 500 firms are stillreceiving billions of dollars in federal small business contracts. Afterreviewing data from the Federal Procurement Data System, the ASBL found of thetop 100 recipients receiving the highest dollar amount in federal smallbusiness contracts, over 75 were currently large businesses, Fortune 500 firmsor subsidiaries of large businesses. Some of the firms that have receivedfederal small business contracts in recent years include, Disney, BritishAerospace Engineering (BAE), Raytheon, Apple, IBM, Hewlett-Packard, Oracle,Lockheed Martin, Rolls Royce and Finmeccanica in Italy.

The largest recipient of federal small business contracts infiscal year 2014 was Verizon.  They received over $125,885,000in federal small business contracts through their subsidiary Terremark Federal Group.

Every year since 2005 the Small Business Administration Officeof Inspector General has named the diversionof federal small business contracts to large businesses as “One of themost important challenges facing the Small Business Administration (SBA) andthe entire Federal Government today…

ABC, CBS, NBC, CNN, MSNBC, CNBC, Fox News and RTTV haveall released investigative reports on the diversion of federal small businesscontracts to Fortune 500 firms.

“Congresswoman Hahn’s call for a new GAO investigation intosmall business contracting fraud could redirect billions in federal smallbusiness contracts from corporate giants and back into the hands of thousandsof legitimate small businesses. This would provide a significant boost to themiddle class economy and create jobs across the country. Congresswoman Hahn iswithout question one of the strongest voices for American small businesses inCongress today,” stated ASBL President Lloyd Chapman.

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