Vendors doing business with IRS owe nearly $600M in back taxes

Some 1,168 businesses that sell products and services to the Internal Revenue Service owe a combined $589 million in delinquent taxes, auditors found.

Federal law — as updated in the 2012 Consolidated Appropriations Act — forbids agencies from signing contracts with companies with unpaid federal tax liabilities, but the IRS’ system of controls, while effective much of the time, is not fool-proof, according to the report released Wednesday by the Treasury Inspector General for Tax Administration.

“When the IRS conducts business with vendors that do not comply with federal tax laws, it conveys a contradictory message in relation to its mission to ensure compliance with the tax laws,” said J. Russell George, Treasury Inspector General for Tax Administration.

The IRS in the past has resisted TIGTA’s recommendation that it conduct an annual check on contractor tax records. And though the agency’s use of its Master Vendor File is generally effective, auditors recently found that the IRS has not checked the General Services Administration’s Excluded Parties List System. The agency improperly awarded four new contracts or exercised additional option years on existing contracts, valued at $2.6 million, to three vendors that were suspended from doing business with the government, the auditors found.

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FBI to sole source mobile forensic contract

The FBI plans to award a sole-source, fixed price contract to New  Jersey-based Cellebrite USA, Inc. for mobile forensic casework tools.  The  contract does not yet have a price.

According to a notice posted Aug. 28 to FedBizOpps, FBI’s market research determined that the  Cellebrite UFED System is the “only hand-held, cellular exploitation device  worldwide that requires no PC or associated phone drivers.”

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Agencies need governmentwide guidance on suspension and debarment process, GAO official says

Though the suspension and debarment system has been around for many years,  there is little guidance for it, Government Accountability Office Acting  Director of Acquisition and Sourcing Management John Neumann said at a June 12  House Government and Oversight Committee hearing.

“You won’t find anywhere in the U.S. code other than a note in the financial  chapter,” Neumann said. “That’s part of the problem. We created a system, but  did not supply guidance on how it should operate.”

The Interagency Suspension and Debarment Committee, established in 1986,  monitors and coordinates the governmentwide system of suspension and debarment,  but agencies aren’t required to work with the ISDC, Neumann noted.

ISDC relies on voluntary agency participation in its informal coordination  process, which works well when used, he said. However, Neumann found that not  all agencies coordinated through ISDC, and agencies without active suspension  and debarment programs generally were not represented at monthly coordination  meetings.

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Secret ‘man caves’ found in EPA warehouse

A warehouse maintained by contractors for the Environmental Protection Agency contained secret rooms full of exercise equipment, televisions and couches, according to an internal audit.

EPA’s inspector general found contractors used partitions, screens and piled up boxes to hide the rooms from security cameras in the 70,000 square-foot building located in Landover, Md. The warehouse — used for inventory storage — is owned by the General Services Administration and leased to the EPA for about $750,000 per year.

The EPA has issued a stop work order to Apex Logistics LLC, the responsible contractor, ensuring the company’s workers no longer have access to the site — EPA security officials escorted contractor personnel off the premises on May 17 — and ending all payments on the contract.

Since awarding the contract in May 2007, EPA has paid Apex Logistics about $5.3 million, most of which went to labor costs. Conditions at the facility “raise questions about time charges made by warehouse employees under the contract,” the report said.

“The warehouse contained multiple unauthorized and hidden personal spaces created by and for the workers that included televisions, refrigerators, radios, microwaves, chairs and couches,” the IG report said. “These spaces contained personal items, including photos, pin ups, calendars, clothing, books, magazines and videos.”

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EPA temporarily suspends BP from federal contracts

The Environmental Protection Agency has temporarily suspended the oil and gas conglomerate BP from receiving any new federal contracts, according to a statement released Wednesday.

Citing the environmental disaster following the Deepwater Horizon oil spill in 2010, EPA said BP’s “lack of business integrity” will bar the company from receiving any new contracts with the government until the company meets “federal business standards.” EPA said the government still will adhere to its existing agreements with the company. BP currently has major fuel contracts with the Defense Department

As part of a deal announced in mid-November that settled criminal charges with the federal government, BP will be paying nearly $4.5 billion in damages and could still face civil lawsuits in the future. In a statement released Nov 15, BP said companies “convicted of certain criminal acts can be debarred from contracting with the federal government” but it had not been “advised of the intention of any federal agency to suspend or disbar the company.”

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