Louisiana Senator David Vitter Questions Accuracy of SBA Data

ASBL research exposes inflated SBA statistics

May 21, 2015, 10:50 ET from American Small Business League

PETALUMA, Calif., May 21, 2015 /PRNewswire-USNewswire/ -- In response to a damaging investigative report released on May 6 by Public Citizen, Louisiana Senator and Chairman of the Senate Small Business and Entrepreneurship Committee, David Vitter, has sent a letter to SBA Administrator Maria Contreras-Sweet concerning the accuracy of the SBA's contracting data. Specifically, Vitter requested the list of every contractor that was counted towards the government's small business procurement goal for FY2014. Vitter also requested the size of the contractor and the amount of contracts awarded to that contractor.

The investigative report titled "Slighted" was based on research from the American Small Business League (ASBL) and interviews from its President Lloyd Chapman. Public Citizen found a wide variety of what they described as accounting tricks that the SBA has used to fabricate and inflate both the volume and percentage of federal contracts that were awarded to legitimate small businesses.

In the letter to Contreras-Sweet, Senator Vitter wrote, "Serious flaws undoubtedly exist in calculating and accurately reporting the number of government contracts annually awarded to small business," referring to over a hundred billion a year in contracts excluded from the SBA's calculations.

An article from the Washington Business Journals by Kent Hoover quoted SBA spokesman John Shoraka admitting that the SBA had no justifications for excluding overseas contracts from their small business calculations.

Also this past March, the House Small Business Committee unanimously adopted an amendment to request a new Government Accountability Office investigation into fraud in federal small business contracting programs and why every year small business contracts are given to large companies, base on research done by Chapman's ASBL.

Every year for the last decade, the SBA Inspector General has named the diversion of federal small business contracts to large businesses as the number one problem at the agency. A long series of federal investigations have also uncovered widespread fraud and abuses in federal small business contracting programs, particularly focused at the Pentagon.

A number of investigative reports from the mainstream media have also uncovered firms like Hewlett-Packard, IBM, Rolls-Royce, Lockheed Martin and Chevron have all received federal small business contracts.

The SBA was scheduled to release their Small Business Procurement Scorecard for fiscal year 2014 at the White House on Friday May 8, but the meeting was abruptly cancelled after stories began to surface regarding the Public Citizen report that found the SBA numbers were inflated. Even Senator Vitter acknowledged this when he implied the SBA "cancelled at the last minute after learning that questions would be asked about how that number was achieved."

The SBA has yet to reschedule the release of the data.

Contact: Steve Godfrey
sgodfrey@asbl.com
707-789-9575

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SOURCE American Small Business League