Big Businesses Scam VA, Taxpayers As ‘Small Businesses’
If your large company has enough skill at gaming the federal contracting system, anything is possible – including being categorized as a “small business.” It’s a great country!
As the Northern Virginia firm MicroTechnologies soared to the top tier of the nation’s small federal contractors, competitors and others in the contracting world asked the same question: How could such a firm still be eligible for deals reserved for small businesses?
In fiscal 2005, the year after its launch, MicroTech had $1.5 million worth of contracts. The next year it had $60 million, then $109 million in 2008 and $311 million in 2011 — a third of it through programs for small and disadvantaged firms, federal records show.
But in 2011, MicroTech certified that it was still qualified for technology contracts reserved for companies with $25 million or less in average revenue over three years. Federal law imposes criminal and civil penalties for false statements about such matters.
A Washington Post investigation found that MicroTech worked with the Department of Veterans Affairs to use a little-known contracting method on deals worth hundreds of millions of dollars.
The arrangement benefited them both. MicroTech got millions in orders, and VA got credit for directing business to a small firm owned by a service-disabled veteran, even though more than 90 percent of the money went to large firms, documents and interviews show.