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Thursday, June 28, 2012

Fraud, Abuse and Loopholes in Federal Policy and Implementation...

Result in the Majority of Federal Small Business Contracts Being Illegally Diverted to Large Corporations Every Year.

- The Small Business Act of 1953 mandates that every year the federal government must spend 23 percent of the total value of all federal prime contracts with small business.

- Every year, the U.S. Government reports achieving, or just narrowly missing the 23 percent small business procurement goal. However, the federal data dramatically overstates the true percentage of legitimate small business receiving federal contracts every year, because large and international corporations are included in the federal small business contracting data. This happens because of misguided SBA policies, lack of oversight by the SBA, as well as plain-and-simple fraud.

- Every year, the American Small Business League conducts a report of the Top 100 companies receiving federal small business contracts during a fiscal year, by listing the 100 companies that received the highest total dollar amount of federal small business contracts in that fiscal year.

- We estimate that the federal government diverts more than $100 billion a year in federal small business contracts to large and international corporations and then counts those contract awards to large businesses in annual federal small business procurement reports.

One way to get involved... 4949 St. Elmo Ave., Suite 221, Bethesda, MD 20814-6067
(301) 652?7410 ––

For more info please call (877) 653-5129 or
Visit us on the Web at

Tuesday, June 19, 2012

GSA Socialistic FSSI Program... Death of Small Business

Via Obama's blessings and initiative, GSA is incrementally shutting down all competition & destroying small businesses via each schedule. A total of $70 Billion Dollars which will cost tax payers additional billions.

This program is called Federal Strategic Sourcing Initiative or FSSI. GSA is eliminating competition via this FSSI Program. The first to feel this FSSI wrath has been the GSA Schedule 75 which has shut down all competition via this socialistic FSSI program. This schedule is for office supplies. (Schedule 75)  From a selection of 525 Schedule 75 GSA Contractors, orders are given to only 15 companies, including 2 "Big Box" retailers, namely Staples and Office Depot, both of whom have been brought up on fraud charges under 31 USC 3729 and SEC charges and were fined and penalized for millions of dollars already. Office Depot & Staples are currently obtaining 65% of all GSA Schedule 75 Sales. GSA Schedules 70, 36, 67 are the next victims for eliminating free competition, destroying 1000's of small businesses and 100,000's of jobs. Hence small business vendors are being kicked out of GSA.

There are ongoing SBA and congressional hearings going on ( ) Rep. Mick Mulvaney, R-S.C last week read ( ) And many more hearings have been held.

This is the irony, Obama supported The 2010 Small Business Jobs Act giving small businesses a chance to fairly and equally compete for government business. Obama then in 2010 gave the go ahead for GSA to eliminate free competition via the above Federal Strategic Sourcing Initiative. Schedule 75 was the first victim to lose free competition and all other GSA Schedules a total of $70 Billion are next. Keep in mind GSA is the largest and sometimes only way for small businesses to sell to the government. GSA claims by using this socialistic procurement method they will save billions of dollars. They claim GSA employees are overworked and cannot keep up with numerous vendors, auditing and price control, hence eliminating free competition is GSA's answer. GSA is full of crap & they currently have the ability to audit and control prices GSA and DoD both currently utilize very sophisticated web sites for buyers to use which currently have very sophisticated audit and price control abilities I will prove it:

1) Go to
2) In the search box put in: Q5950A Remanufactured Toner & Click the Go Button...
3) Now you will see the Sort By Most Relevant Drop Down Box, Hence select Price - Low to High...
4) Then you will notice all the different companies that offer this item hence to drill down if they are a small business, woman owned, 8A, veteran owned ect. Then click the very top description line that is underlined for given company, hence you will go into another page, hence go to the bottom of that page and see Socio, hence that tells you if it is a small business, vet owned, ect...
5) If they have questions go to mid part of page you will see: $Price EA sold and shipped by ABC Company, LLC Hence click the company name for their phone #, address, email address, phone #, and fax #
6) Also you will notice via there are symbols for environmental friendly products, Ability One, ect. Everything you need is here
7) DoD EMALL is exactly the same but you need a secure token to enter web site. Only vendors and buyers have a security token...

These are my thoughts Why is GSA slapping competition in the face. Instead they should be slapping buyers hands if they make unnecessary and dumb over cost purchases. What is required is a very strict government buyer purchase program with very strict disciplinary action if purchases are made outside of given web sites allowing free and open competition within these web sites. Also, disciplinary action would occur if the government buyer does not buy the best quality & lowest priced item(s) per SBA small business requirements, goals, regulations, laws & rules. I know it is not Congress Job to Micro Manage.

With that said I wanted to add this very vital additional information for Congressional general understanding. A software company should definitely give testimony to Congress on how GSA & DoD can wisely use their vast amounts of computerized GSA/DoD information & data. No need to reinvent the wheel. Via creating various programs both GSA & DoD can both save much more money than using the FSSI Schedule 75 BPA which is a 20th century old fashion approach. This can be done without additional funding. If our nation goes to war of course the military dedicates its main resources to that cause. GSA & DoD can prioritize this software project via existing employed Software Engineers with no additional funds. It takes the will and priority to make this happen. Case and point look at If they can handle 1,000,000s of orders via 100,000s of vendors then GSA with their existing data should be able to do the same. I know the government is not a company but GSA has incredible amounts of data and very smart software engineers. Via new created programs they can easily identify buyers overspending and notify given superiors and agencies. A big problem I have noticed via E-Buy many government buyers are purchasing OEM & New items when they are mandated & required to purchase recycled items. We can go on and on but GSA & DoD has more than enough data to really control budgets and cost via the buyer. They can also create programs to control vendor issues currently being done via GSA & DoD employees hence automating given tasks humans are currently performing.

Info & Ways to get involved...

Go to and in the Google search box enter ( Congressional FSSI Hearing ) there you will find additional information. Currently there are proposed rules to enhance The Small Business Jobs Act of 2010 regarding unfair FSSI agreements implemented by GSA, DoD & NASA. To see rules simply go to and via search box enter ( Federal Register / Vol. 77, No. 95 / Wednesday, May 16, 2012 / Proposed Rules ).

You may also submit comments, identified by RIN: 3245-AG20, or contact Dean Koppel, Assistant Director, Office of Policy and Research, Office of Government Contracting, U.S. Small Business Administration, 409 Third Street SW., Washington, DC 20416, (202) 205-7322.

Samuel D. Bornstein is preparing a study, Professor of Accounting and Taxation Kean University, School of Business, Union, NJ Partner-Bornstein & Song, CPA's & Consultants, Oakhurst, NJ
Tel: (732) 493 - 4799 Fax: (732) 493 - 3399

For more information contact
4949 St. Elmo Ave., Suite 221, Bethesda, MD 20814‐6067
(301) 652‐7410 ––

For more info please call (877) 653-5129 or Visit us on the Web at

Obama has it wrong, Socialism is not needed...

Tuesday, June 12, 2012

Large Corporations and Federal Contracting Officers are not being punished...

Large Corporations and Federal Contracting Officers are not being punished for missing their small business procurement goals and are not being prosecuted for fraudulent contracting.

Existing federal laws known as "Liquidated Damages" clauses establish penalties for prime contractors when they are non-compliant with small business goals. Because this law has never been enforced by the SBA and Department of Justice, most prime contractors never achieve the small business goals required in their federal contracts.

Current federal law establishes that misrepresenting the size of a firm in order to illegally receive federal contracts and subcontracts is a felony with penalties of up to 10 years in prison, a fine up to $500,000, cancellation of all contracts and debarment from selling to the government. Federal policy should require the SBA to respond to any protest against any firm that misrepresents its size, regardless of whether or not the contract is a small business set-aside. Section 16(d) of federal code makes no differentiation as to the type of the contract; therefore current SBA policy is illegal and does not address the magnitude of the problem.

One way to get involved...

For more information contact
4949 St. Elmo Ave., Suite 221, Bethesda, MD 20814-6067
(301) 652?7410 ––

For more info please call (877) 653-5129 or Visit us on the Web at