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25 Year Old Fraudulent Pentagon Contracting Program Exposed

Companies mentioned in this article: American Small Business League

PETALUMA, CA -- (Marketwired) -- 06/12/14 -- According to the American Small Business League, the American Small Business League (ASBL) has uncovered a 25 year old program that has allowed some of the Pentagon's largest prime contractors to violate federal contracting for almost a quarter of a century.

The Comprehensive Subcontracting Plan Test Program slid under the radar of journalists and the public since 1990. The test program was adopted under the guise of increasing subcontracting opportunities for small businesses.

In reality the test program did just the opposite. Some of the biggest names in the defense and aerospace industry were allowed to circumvent federal law that required small business contracting goals be achieved. Firms participating in the program were exempt from any reports that had previously been available to the general public.

In addition to the total lack of transparency, prime contractors participating in the test program were exempt from any penalties such as "liquidated damages" for non-compliance with their small business subcontracting goals.

The ASBL estimates American small businesses were defrauded out of over a trillion dollars in federal subcontracts over the last 25 years as a result of the program.

The 2015 National Defense Authorization Bill proposes to extend the Comprehensive Subcontracting Plan Test Program into its 28th year of testing.

Language in the bill acknowledges the Pentagon has never been able to provide any data that the removal of transparency and penalties for prime contractors has ever increased subcontracting opportunities for small businesses.

Section 811 of the bill states, "However, after nearly 24 years since the original authorization of the program, the test program has yet to provide evidence that it meets the original stated goal of the program..."

A 2004 Government Accountability Office investigation also found no evidence if the removal of transparency and penalties for prime contractors increased opportunities for small businesses.

The Pentagon has also refused to release any data on firms participating in the test program under the Freedom of Information Act.

The ASBL has filed suit against the Pentagon in Federal District Court in San Francisco after the agency refused to provide data on Comprehensive Subcontracting Plan Test Program participant Sikorsky. The ASBL has also requested data submitted to the test program by British Aerospace and Engineering (BAE) and Lockheed Martin.

The ASBL has launched a national campaign to block the renewal of the Program. To date, the Pentagon's plan to renew the Comprehensive Subcontracting Plan Test Program into its 28th year of testing has gone unreported in the mainstream media.


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