Contractors Accused Of Prior Fraud Received Nearly $500M In COVID-19 Contracts
Contractors previously accused of fraud have received millions of dollars in emergency Covid-19 contracts from the federal government, according to USA Today.
In a frantic rush for supplies and services, the federal government has put out more than $16 billion in coronavirus contracts. An investigation launched by USA Today has found that hundreds of millions of dollars in non-competitive awards have gone to vendors accused of defrauding taxpayers through the False Claims Act. However, the newspaper noted that the “need for lifesaving supplies might reasonably be seen as outweighing a vendor’s questionable record,” and also that “not every False Claims Act accusation is substantiated.”
Steven Schooner, who served as a career official in the Clinton administration procurement policy office, commented about the situation:
“Most government experts agree that if you have to choose between not getting medical supplies and getting them, you get the medical supplies. You have to tolerate a higher error rate.”
USA Today’s investigation discovered that vendors accused of False Claim Act violations received more than 6,100 Covid-19 orders worth $500 million.
In addition to the False Claim Act violations, vendors who have been accused of racketeering, securities fraud, bribery, negligence, breach of fiduciary duty and contract violations have also received contracts.
The government relies on whistleblowers to identify instances of shady business practices, but U.S. Sen. Chuck Grassley, R-Iowa, says that’s part of the problem:
“We shouldn’t have to rely solely on good citizens to provide oversight for huge federal contracts. Companies that have previously defrauded taxpayers need to have giant red flags on their files and ought to be doubly scrutinized before being handed another fat contract.”