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(EMAILWIRE.COM, August 15, 2008 ) Washington D.C., - The Inspector General of the Small Business Administration (SBA) issued a report that found the SBA issued 90 percent of the agencyÂ’s training budget for small disadvantaged businesses to a single, no-bid contractor. It also found that the recipient of the contract, VBP Group of Scottsdale, Arizona, was given an inappropriate 8(a) certification after only being in business for 11 days.
"This no-bid contract was given to an outgoing Administration employee rather than to companies and organizations with extensive track records of working with the small and disadvantaged business community," said David C. Lizarraga, Chairman of the powerful United States Hispanic Chamber of Commerce (USHCC). “(The contract) was given to a single contractor who falsified documents, handed a majority of the work to unapproved subcontractors and spent most of the funding on salaries.”
Lizarraga was referring to VBP GroupÂ’s principle Vernon Parker, a former Assistant Secretary for Civil Rights at the United States Department of Agriculture, whose certification had initially been denied by the SBA. It is believed someone with an SBA supervisor's password entered SBA's electronic systems to reverse the denial of certification, and then recommend and approve the certification.
The SBA is responsible for issuing contracts and grants that provide technical assistance and training to small and disadvantaged businesses. Congresswoman Nydia Velazquez brought initial concerns about the award of the training contract to an unqualified sole source bidder to SBA officials.
"We credit Representative Velazquez for bringing this issue to light," said USHCC President and CEO Augustine Martinez. "We are truly disappointed that the SBA channeled this contract to a former Administration official with no experience in this field."
The SBA has since revoked the VBP Group contract based on “documents submitted by VBP that were false or of questionable authenticity."
"We thank SBA Acting Administrator Jovita Carranza for taking action quickly on this issue,” says Lizarraga. “We are extremely concerned that funds meant to educate our members, small and minority businesses, were lost to fraud, graft and wholesale mismanagement."
The USHCC is an organization comprised by and representing more than 2.5 million Hispanic business owners. For more information contact the USHCC at www.ushcc.com.
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