IG: DOD Errors in Verifying Small Businesses' Status

March 2, 2012

The Defense Department awarded more than $340 million to ineligible companies instead of to service-disabled veterans, according to a new report.

Throughout DOD, defense officials awarded six contracts worth approximately $1.9 million to ineligible companies and 27 contracts worth $340.3 million to contractors that potentially misstated their status as a service-disabled veteran-owned small businesses (SDVOSBs), according to a report released March 2 by the DOD inspector general.

DOD's Office of Small Business Programs' policy did not require adequate verification of contractor status before awarding set-aside and sole-source contracts, the report states. 

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