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Pentagon investigating whether Amazon employee tilted JEDI contract

The Defense Department will review whether a former employee—who now works at Amazon Web Services—improperly impacted the integrity of its $10 billion JEDI cloud contract.

The conflict of interest investigation comes approximately one month before the Pentagon was set to award the $10 billion contract—to host, analyze and process swaths of classified and sensitive military data—to one of four competing companies: AWS, Microsoft, IBM or Oracle.

In a partially redacted court filing released Friday in Oracle’s suit against the Defense Department, government lawyers explained their motion to stay—or delay—the case stemmed from “new information” regarding “possible conflicts of interest involving former DoD employee, Deap Ubhi.”

Ubhi worked in the Pentagon’s Defense Digital Service for almost two years in between jobs at Amazon Web Services.

Keep reading this article at: https://www.nextgov.com/it-modernization/2019/02/pentagon-investigating-whether-amazon-employee-tilted-jedi-contract/155118/

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$110,000 settlement reached with tech company and CEO to resolve allegations of false claims on Defense contract

The U.S. Attorney for the District of Colorado, has announced that Progressive Technology Federal Systems, Inc. and its Chief Executive Officer have paid a combined $110,000 to settle allegations that the corporation and its CEO made false statements concerning a consultant’s security clearance and failed to disclose an organizational conflict of interest when bidding on a defense procurement contract. 

One way federal government agencies can buy information technology services is by working with the National Institutes of Health’s Information Technology Acquisition and Assessment Center (NITAAC).   NITAAC is a government-wide program that enables agencies to contract for information technology.  Other federal agencies, including the military, regularly work with NITAAC.

The United States’ allegations relate to a project in which NITAAC was used by the Army and the Air Force for a contract that was awarded to Progressive Technology Federal Systems, Inc. (PTFS).   The United States contends that in 2014, PTFS’s President and CEO, John Yokley, participated in preparing project specifications for a contract to be issued by NITAAC.  The project then was offered by NITAAC for contract bids.  PTFS then submitted its own proposal to take on the contract.  In doing so, however, PTFS stated that it had no conflict of interest relating to the contract.  This statement was false because PTFS had a conflict in that Mr. Yokley had provided input on project specifications that were included in the contract, thereby gaining a competitive advantage for PTFS.  In addition, the project required security clearances, and PTFS falsely stated in its proposal that an individual who would participate in the project as a key “Subject Matter Expert” had an active Top Secret clearance.  PTFS was awarded the contract.  Funding for the contract was later terminated before PTFS could invoice more than $30,000.  The United States claimed that this conduct violated the False Claims Act.

The claims settled by this agreement are allegations.  In entering into this civil settlement, PTFS and Mr. Yokley did not admit liability.  Under the agreement, PTFS paid $65,000, and Mr. Yokley paid $45,000, to resolve the allegations.

Source: https://www.justice.gov/usao-co/pr/us-attorney-announces-110000-settlement-tech-company-and-its-ceo-resolve-allegations

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CDC senior contracting officer sentenced for failing to disclose payments from contractor

As a result of his Nov. 8, 2017 indictment, Carlos Smiley was sentenced to federal prison on Nov. 15, 2018 for making false statements in his annual conflict of interest certification. 

Smiley was a long-time federal employee, having served in positions at NASA’s Marshall Space Flight Center in Huntsville, Alabama and at DoD’s Army Aviation Systems Command in St Louis, Missouri.  At the time of his indictment, he was a senior contracting branch chief at the Centers for Disease Control and Prevention (CDC) in Atlanta, and the president of the Atlanta chapter of the National Contract Management Association.

According to U.S. Attorney Byung J. “BJay” Pak, the charges and other information presented in court are:

  • On February 16, 2012 and January 7, 2013, Smiley completed Confidential Financial Disclosure Reports required by his position as a CDC Contracting Officer.  Both times, Smiley answered “no” to the question asking whether he had received outside income.
  • Between September 2011 and January 2012, Smiley received several payments from A-TEK, a Virginia-based holding company that was seeking to do business with the CDC during that time.
  • CDC previously granted Smiley’s request to operate a company called Charisma III, Inc. as an outside business activity. After that, Smiley ostensibly received payments through Charisma III for real estate investment advice.
  • In 2012, A-TEK was awarded a single-source contract for the staffing of CDC field stations overseas.  Smiley signed the contract as the approving contracting officer for CDC.  A-TEK turned down the contract after learning of the relationship between Smiley and a representative of its holding company, who was also an A-TEK employee until fired for his conduct.  Smiley failed to disclose six payments for a total of $30,600.
  • In 2015, CDC investigators confronted Smiley about the payments.  He admitted to receiving them and to having invented the Charisma III officer whose fictitious name appeared on the purported agreement between Charisma III and the holding company for real estate investment advice.

Carlos Smiley of Roswell, Georgia was sentenced to three months in federal prison by U.S. District Judge Thomas W. Thrash, Jr. on November 15, 2018.

Smiley was also sentenced to one year of supervised release and 200 hours community service following his release from prison. He was also fined $5,000.

Smiley was convicted of the charge on July 19, 2018, after pleading guilty to making false statements.

The case was investigated by the Department of Health and Human Services, Office of the Inspector General.

Source: https://www.justice.gov/usao-ndga/pr/cdc-senior-contracting-officer-sentenced-failing-disclose-payments-contractor 

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VA official charged with taking bribes to help associates rig federal contracting process

Three men were arrested in Colorado on Wednesday of this week pursuant to warrants issued in connection with an indictment charging them with conspiring to pay and receive bribes in exchange for creating an opportunity to commit a fraud against the U.S.  Department of Veterans Affairs (VA). 

The defendants are also charged with paying and receiving bribes, or aiding and abetting the payment of bribes.

Dwane Nevins, a VA contracting official at the time of the alleged crimes, was separately charged in another count with extortion under color of official right and in two counts with violating the federal conflict of interest statute.

The following is alleged in the indictment:

  • Dwane Nevins — a small business specialist at the VA’s Network Contracting Office in Colorado — agreed to take bribes offered by Robert Revis, Anthony Bueno and an undercover FBI agent to help them manipulate the process for bidding on federal contracts with the VA.
  • Revis and Bueno, working with Nevins, agreed to submit fraudulent bids from service-disabled-veteran-owned small businesses under contract with their consulting company so that federal contracts would be set aside for only those companies.  As Bueno allegedly explained, they would then “own all the dogs on the track.” 
  • Nevins, Bueno and Revis worked to conceal the nature of the bribe payments by either kicking back to Nevins a portion of the payments made to their consulting company, or by asking their consulting company’s clients to pay Nevins for sham training classes related to federal contracting.

The indictment also alleges that, after complaining about not being paid by Revis and Bueno for his participation in the scheme, Nevins used his official position at the VA to extort approximately $10,000 from an undercover FBI agent, telling the agent that “the train don’t go without me.  You know what I mean?  I’m the engine.  I’m the caboose.  I’m the engine room.”  Nevins also allegedly told the undercover FBI agent: “This is a business and businessmen need to get paid . . . . so I can have my Christmas, you know what I’m saying?”

The indictment alleges that the conspirators attempted to rig the process related to two particular contracts, both of which related to medical equipment and not to the construction of any VA facilities.  The first contract related to the procurement of LC bead particle embolization products by a VA hospital in Salt Lake City, and the second contract related to the procurement of durable medical equipment for VA facilities located throughout the region.

The case was jointly investigated by the Federal Bureau of Investigation, the U.S. Department of Veterans Affairs Office of Inspector General, and the U.S. Small Business Administration Office of Inspector General.

Readers are reminded that the defendants are presumed innocent unless and until proven guilty in a court of law.

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Pentagon’s contracting gurus mismanaged their own contracts

The Pentagon’s contracting gurus repeatedly made massive, preventable mistakes while managing contracts for a critical software project of their own, violating federal budget law along the way, according to scathing internal reports and other records obtained by the Project On Government Oversight (POGO).

Ironically, the purpose of the mismanaged system is to help manage the rest of the Pentagon’s contracts.

The Pentagon relies on the obscure Defense Contract Management Agency (DCMA) to negotiate and administer $5 trillion in contracts across the Defense Department as an average of $455 million in taxpayer dollars are paid out each day to contractors. How well that agency does its job directly affects both how wisely taxpayer dollars are spent and whether our troops get what they need when they need it. Yet the cascading series of major, systemic failures within the agency, which has nearly 12,000 employees and an annual budget of roughly $1.5 billion, led an independent investigator from the Army to go so far as to recommend that it be prohibited from awarding its own contracts in the future.

Documents obtained by POGO — including a September 2017 preliminary investigative report, an April 2018 internal memo, and a draft of the final report from this summer — show that over the course of several years, the agency mismanaged contracts for the software project. The agency spent far more than it was authorized to spend, violated numerous policies and regulations, and received insufficient oversight from the Pentagon. When these documents are viewed alongside Defense Department watchdog findings from recent years, there appears to be an agency-wide pattern of failing to adequately support the Pentagon’s procurement efforts and sufficiently protect the taxpayer — the agency’s very mission.

Keep reading this article at: http://www.pogo.org/our-work/articles/2018/pentagons-contracting-gurus-mismanaged-their-own-contracts.html

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