Government Contracts Monitor

Short Take: GSA OIG Report Touts Success in Detecting Fraud

June 8, 2015

By: Eric Whytsell

The General Services Administration (GSA) Office of Inspector General (OIG) recently released its semiannual Report to the Congress detailing its efforts and successes in the important work of detecting fraud and mismanagement within the GSA’s programs and operations. The report, which is required, covers the period between October 1, 2014 and March 31, 2015.

During this period, the GSA OIG identified over $1.15 billion in costs that were questionable and funds that could have been put to better use. At the same time, the GSA OIG issued 42 audit reports and referred a total of 220 matters for criminal prosecution, civil litigation, administrative action, and suspension and debarment. Civil settlements and court-ordered and investigative recoveries during the reporting period amounted to over $78 million.

The highest profile recovery resulted from the investigation of Iron Mountain, Inc. The company agreed to pay $44.5 million to resolve allegations that it overcharged federal agencies in violation of the False Claims Act. In addition, two former GSA contractors agreed to pay $4.8 million to settle civil claims relating to their alleged creation of a "front" company to obtain contracts through the Small Business Administration’s 8(a) program. Another GSA OIG investigated resulted in 10 years of jail time and an order to pay $7.8 million in restitution based on an individual’s role in defrauding GSA’s Computers for Learning education donation program.

Clearly, the GSA OIG is "on the case" and actively working to identify and pursue both individuals and companies that engage in criminal or otherwise inappropriate activities relating to government contracts with the GSA. Its ongoing efforts exemplify those of OIGs throughout the federal government. Government contractors should take heed: just as detecting fraud and mismanagement is serious business, so is selling to the government.

Work hard to understand and comply with applicable contract and legal requirements. If you don’t, you may end up discussed in a future Report to the Congress.

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