WASHINGTON — A former Army Corps of Engineers employee has pleaded guilty to his role in a $30 million bribery and kickback scheme involving the awarding of government contracts.
Kerry F. Khan pleaded guilty Thursday in U.S. District Court in Washington. His son, Lee Khan, also pleaded guilty Thursday.
The Khans and two other men were charged in a complex scheme to defraud the government through inflated invoices and the corrupt steering of contracts.
The two other men, former Army Corps of Engineers employee Michael A. Alexander, and Harold F. Babb, director of contracts at an Alaska Native-owned small business, have pleaded guilty. Several others have been charged.
U.S. Attorney Ron Machen said the cases against the men were as strong as “you would ever want to see.”
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of the Alaska business involved.
Wonder how much the American People would save
if all the fraud and theft in business/government relationships could be stopped? Add to that all the Medicare/Social Security, and income tax cheating. Bet it would take a big bite out of our debt.
Another good idea ruined
The whole purpose or intent of giving preference in contracting with the federal government by small businesses, starting corporations, minorities so they might eventually be able to get a start and share in competitive bidding seems to me to have been a good idea. Help a small business or others get a start.
But then greed and corruption on the part of those who got the non-competitive contracts, and those who saw an opportunity to use others for profit, has turned things into a problem.
I know many will say that there should be no preference, no non-competitive contracts and a small business, or a minority-owned business has to just jump in a compete with Haliburton, large corporations or businesses and "swim or sink." And that any "government intervention" is evil or goes again "laissez faire capitalism" and must be avoided, I personally think the original idea was a good one, but now needs more oversight to make sure the newcomers to the business world are not ripped off by others.
That's just my opinion.
Who's corrupt?
There are many many more corrupt government contractors in this country besides ANCs. Eyak Technology LLC is the contractor involved. However people need to notice that it is the CORP OF ENGINEERS employees that are pleading guilty. Eyak Corporation owns the subsidiary Eyak Technology - however it's a non-native Harold in Dulles MD that is involved, and a subcontractor. The people involved in the corruption are the subcontractor who submitted falsified invoices and the Corp of Engineers employees. People hear 'Native Corporation' and automatically assume it's corrupt. That's not true. In order for those contracts to be awarded - there are government employees that have to certify the pricing is fair and reasonable. Ted Stevens created the laws for the 8A setaside Alaska Native Corporations. I think everybody forgets the intent behind that. His intentions were that it would help create business with one of the few resources/tools that Alaska Natives had - their corporations.
It does not matter if it was a subcontractor
The parent corp has a duty to control the dealings of those who do business in their name else it's sloppy management. This is the problem...no one wants to take responsibility...they just want to take the money!
Not exactly a total surprise...
It's fairly well known that certain native corporations routinely bid-on (and win) non-competitive contracts, while totally lacking any of the experience and resources necessary to complete the work. The real intent of these these native corporations is (for a fee/kickback) to hire as subcontractors: larger companies, who, if left on their own, would have been required to submit a competitive bid for the said project.
The native corporation never really had any intention of performing the actual work, but was instead relying on their guaranteed middleman money for income. The larger company, could then of course, charge whatever they wanted without the constraints of a set contract... cost overruns up the yin-yang!
A win-win for everybody... except possibly for the tax-payers who were actually funding the project. I'm fairly sure that Ted Stevens was well aware of these occurrences.
taxpayers deserve awards go to the cheapest and best bids
where the companies are fully experienced and capable of performing the work.
Any other form of contact award is nothing more than theft of taxpers money.
@DTRT
Which do you want: the cheapest or the best? Like my mechanic says, "You can have it cheap, quick or good. Pick two."
I used to own a company that bid on City contracts. In his wisdom, the then Building Maintenance Supervisor (now Parks & Rec director) got away from simple low bid scenarios, and instead required bidders to list not only their bid amount, but their experience, how they would enforce quality control, the equipment to be used, resumes of the staff who would be performing the work, and a host of other standards. Each area was awarded weighted points and the highest total got the contract, but it wasn't necessarily the cheapest bid.
I would like to see that approach adopted by State and Federal entities who put out RFP's.