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Small Business Advocate Responds to Senator KerryÂ?s Demand for Increased Small-Business Contracts Accountability and Investigation of Fraud.

– In response to a press release disseminated Tuesday by Sen. John F. Kerry (D-Mass) that called for a comprehensive audit of fiscal year 2003 small-business federal contracting numbers, Lloyd Chapman, small business advocate and president of the American Small Business League (ASBL), has issued the following statement:

“I’m glad to see Senator Kerry take a stand for small business. A lot of people in government talk about helping small business but Congress has done nothing to address the fact that most small business contracts are being awarded to some of the largest companies in the U.S. and Europe. It looks like Senator Kerry is the only one that is willing to step up to the plate and demand that something be done to stop the widespread fraud and abuse that has been uncovered in a series of government and private investigations.

“The SBA’s own Office of the Inspector General found a pattern of blatant fraud in small business contracting as far back as 1995. Small business contracting fraud is a felony with a ten-year prison term. In refusing to take any action to address this problem the SBA is encouraging billions in fraud and abuse in small business contracting. Instead of taking decisive action to eliminate fraud the SBA has consistently tried to convince the public this is nothing more than miscoding and computer glitches.

“The Center for Public Integrity found the Defense Department alone had awarded $47 billion dollars in small business contracts to some of the largest firms in America. I think it’s time for the Justice Department to step in and investigate the SBA’s handling of this issue. I just don’t trust the SBA anymore.”

In October 2004, the ASBL filed a complaint against the SBA demanding the disclosure and release of a report on small business contracting abuse, citing the Freedom of Information Act. The SBA’s refusal to release the report came just days after the Center for Public Integrity released its own report, which found the Defense Department had awarded more than $47 billion in small business contracts to some of the largest firms in the United States and Europe with the full knowledge and approval of the SBA.

As a long-time advocate for small business, Lloyd Chapman has had a 15-year running battle with the SBA to oppose policies and programs that have allowed larger and larger firms to receive U.S. government contracts meant for small business. In November 2002, Chapman uncovered information on fraud and abuse that prompted an investigation by the GAO.

The resulting GAO report identified billions in small business contracts going to very large businesses, prompting the Committee on Small Business for the House of Representatives, Congress of the United States to call a hearing on the matter. In May 2003, Chapman testified at the hearing and provided ASBL’s findings and data. Chapman also provided information to the SBA that forced the removal of more than 600 large businesses from the SBA’s database of small businesses. The GAO investigation and subsequent Congressional hearing prompted a host of changes in government small business policies, such as recertification for small businesses, changes in SBA protest procedures, reexamination of small business size standards and the GSA “Get It Right” program.

ABOUT THE AMERICAN SMALL BUSINESS LEAGUE (ASBL)

The American Small Business League was formed to promote and advocate policies that provide the greatest opportunity for small businesses – the 98 percent of U.S. companies with less than 100 employees. The ASBL monitors existing policies and proposed policy changes by the SBA, and other federal agencies that affect its members, and helps to coordinate any response required to safeguard the interests of small businesses. The organization achieves significant and measurable results for small businesses across America, seeking their congressionally mandated 23 percent share of federal contracts. Prior to Sept. 1, 2004, ASBL was known as the Microcomputer Industry Suppliers Association (MISA). For more information please contact Lloyd Chapman at 707-789-9575

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