The American Small Business League (ASBL) has filed for an injunction against the Small Business Administration to stop the agency from diverting federal small business contracts to Fortune 500 firms, their subsidiaries and thousands of large businesses.
The ASBL is also asking the court to stop the SBA from fabricating the government's compliance with federal law that mandates a minimum of 23% of all federal contracts be awarded to small businesses. The SBA has fabricated the federal governments compliance with the goal by excluding the vast majority of federal contracts from their calculations.
In 2015 the SBA claimed small businesses had received 24.9% of all federal contracts. To achieve that number, the SBA excluded approximately $800 billion in federal contracts and include billions in federal contracts to over 151 Fortune firms. The ASBL estimates in 2015 legitimate small businesses probably received no more than 5% of all federal contracts and not the 23% required by law.
In July, Mother Jones released an investigative article titled, "Giant Corporations Reaping Billions in Federal "Small Business" Contracts".
As early as 1995 the Inspector General for the Small Business Administration uncovered large businesses were fraudulently receiving federal small business contracts. The Inspector General referred to it as a "particular fraudulent practice."
In 2003 Government Accountability the Office uncovered over 5,300 large businesses had illegally received billions in federal small business contracts and subcontracts. The Associated Press published an article on the rampant fraud that ran in newspapers across the country.
In 2005 the SBA Inspector General released Report 5-15 that stated, "One of the most important challenges facing the Small Business Administration and the entire federal government today is that large businesses are receiving federal small business awards and agencies are receiving credit for these awards."
In 2015 Public Citizen released their investigative report on the abuses titled, "Slighted, Accounting Tricks Create False Impression Small Businesses Are Receiving Their Fair Share of Federal Contracts."
ASBL President Lloyd Chapman stated, "When we win this case it will finally close the door on over twenty years of fraud and corruption at the Small Business Administration. All of our research indicates that it will increase the volume of federal contracts to legitimate small businesses by well over $200 billion a year and create millions on new jobs in every state in the country."
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SOURCE American Small Business League