The US Women Chamber Of Commerce announced something critical on November 11, 2014 for the President, SBA and the Congress which requires immediate action. They need to make the female owned small business contracts accountable. Call to action is required followed by publishing a report from the government accountability office. It was released on November 17, 2014 for accountability in the SBA based on the federal contracting of supposed women owned businesses who won government bids.
Details of the systematic as well as costly failure committed by the SBA related to the small business owned by the females was presented to the outgoing Senator Mary Landrieu and Maria Cantwell along with the Chair and former Chair of Senate Committee. They were required to provide a GAO report, which said that more than 40 percent of the women owned government bids that were set side were given to the ineligible firms in fiscal year 2012 and 2013.
Here are the important disclosures of the GAO report:
Failure of Oversight
SBA had performed less oversight for the third party certifiers and it needs to work on developing procedures that offer assurance that only those businesses will receive the women owned set aside contracts or the government contracts that are eligible.
No Responsiveness
The SBA did not interview most of the third party certifiers in the program. It was unable to interview the WBENC (Women’s Business National Enterprise Council). No procedures were performed regarding the fee structures and even the certification.
No Action
No action was taken by the SBA for the rectification of its cooperation with the WBENC or for removing the WBENC as the third party certifier. The Board of Directors from WBENC included some of the senior CEOs from the largest firms in America. Many among these firms were the federal prime contractors.
Ignoring The Reports Of Potential Fraud
After reviewing monthly reports of the third party certifiers, it was found that one of the certified had listed 2 or 2 reports about the fraud among businesses. The SBA did not take any action for investigating about these reports.
Margot Dorfman, CEO of the U.S. Women's Chamber of Commerce said that "it is clear that the support of the SBA to females in the business is not what it is projected by the SBA in its press releases." When the financial results of these ineligible firms were assessed, it was revealed that the subterfuge and inaccuracies were translated into billions of dollars and this amount of money has been misattributed. In the fiscal year 2014, the potential dollar loss accounts for $5 billion.
According to Jim Ward, VP of Business Development at BidPrime, a government bid database and research firm, "This same phenomena is already present in state and local government contract practices, where there is even less oversight." He added that, "cities, counties and municipalities are under a lesser microscope for their government contracts and bids. Many government bids which are issued for Women or Minority owned businesses either don't have competition or a proper vendor outreach tool in order to advertise to women owned small businesses."
The GAO report also focused on disclosing ineligible firms in the database of the federal government across various socioeconomic sectors in combination with the observations of GAO about the failure of SBA’s oversight. The President and the Administrator of SBA along with the Congress will be set up an action plan for protecting the rights and opportunities of women who are running small businesses. Visit at http://www.gao.gov/products/GAO-15-54 & http://www.bidprime.com/tour
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