PETALUMA,Calif., Aug. 1, 2016 /PRNewswire-USNewswire/ -- The Small BusinessAdministration (SBA) has finally responded to the federal injunctioncase filed by the American Small Business League (ASBL)on May 3rd.

The SBA's responsedodged the two substantive issues of the case. The response did not include anyspecific justification to the SBA's long standing policy of diverting federalsmall business contracts to Fortune 500 firms.  The SBA's responsecontained no legal justification for falsifying the government's compliancewith the 23% small business contracting requirement by excluding the majorityof the federal acquisition budget.

ASBLattorney Robert Belshaw stated, "The SBA has obviously sidestepped therelevant issues of this case because their policies are undeniably in directconflict with the Small Business Act."

TheSmall Business Act requires a minimum of 23%of the total value of all prime contracts to be awarded to small businesses andsmall businesses owned by women, minorities and service disabled veterans. TheSBA's "exclusionarypolicy" excludes the majority of the federal acquisition budgetfrom their calculations which dramatically reduces the volume of contractsawarded to all categories of small businesses.

SBAAdministrator Maria Contreras-Sweet has admitted the SBA has a "grandfathering rule"they use to report federal contracts to Fortune 500 firms such as Chevron,Northrop Grumman and Raytheon as small business contracts. In fiscal year 2015,the SBA included contracts to over 151 Fortune 500 firms inthe $90 billion they claim were awarded to small businesses. In recent yearsthe SBA has diverted billions in federal small business contracts to hundredsof firms such as Verizon,IBM, Hewlett-Packard, Microsoft, HomeDepot, Oracle, General Dynamics, Bechtel, Walmart, Citigroup,Johnson & Johnson, Honda, Finmeccanica in Italy, Thales in France, BritishAerospace (BAE) and Rolls Royce.

TheSBA's own Inspector General has described the diversion of federal smallbusiness contracts to large businesses as "One of the most important challengesfacing the Small Business Administration (SBA) and the entire federalgovernment today…."

PresidentObama released the statement,"It is time toend the diversion of federal small business contracts to corporate giants."

The General Accounting Office(GAO) found over 5,300 largebusinesses were the actualrecipients of billions of dollars in federal small businesscontracts. GAO Report 10-108uncovered similar fraud and abuse.

In2015, Public Citizen released an investigative report titled, "Sleighted- Accounting Tricks Create False Impression That Small Businesses Are GettingTheir Share of Federal Procurement Money." On July 25^th,Mother Jones released their investigative piece on the SBA titled, "GiantCorporations Are Reaping Billions From Federal "Small Business"Contracts."

ABC, NBC, CBS, CNN, Fox News, CNBC, MSNBC, RTTV, HuffPost Live, and the APhave reported on the abuses. ASBL President Lloyd Chapman is releasing a documentary on thehistory of fraud at the SBA.

CaliforniaNorthern District Court Judge Vince Chhabria will preside over the case(3:2016cv02410).

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