PETALUMA, Calif., June 1, 2006 /PRNewswire/ The Justice Department, acting on behalf of the Small Business Administration, has responded to a suit filed in Federal court under the Freedom of Information Act by the American Small Business League. The government is refusing to release the name of a contractor that was found to be intentionally misrepresenting itself as a small business in order to illegally receive Federal small business contracts. United States Attorney Kevin V. Ryan is claiming exemptions under the Freedom of Information Act that would allow the government to withhold the name of the firm because of an ongoing criminal investigation.

The SBA's Office of Inspector General conducted an investigation into the matter last year. In June 2005, the Inspector General recommended to SBA Administrator Hector Barreto that the firm in question be debarred from doing business with the Federal government. Barreto will leave office in June without taking any punitive action against the firm.

Under Federal law, misrepresenting a firm's status as a small business in order to receive Federal small business contracts is punishable by up to ten years in prison, a $500,000 fine per occurrence, and permanent debarment from doing business with the government.

The ASBL believes the company may have illegally received millions of dollars in Federal small business contracts. President Lloyd Chapman stated, "I find it very difficult to believe that the investigation is ongoing, and I don't think the government has any plans to prosecute the firm."

Chapman went on to say, "We don't know who the contractor is but if they are guilty of misrepresenting their company, they should be debarred and prosecuted according to the law."

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 1953. 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.

###