National Association of Government Contractors


Whistleblower Exposes $1.34M Army Contract Loss

A whistleblower exposed how the Army lost possession of six government-purchased fuel trucks, indicating that improper contracting procedures -- which cost the service about $1.34 million – were to blame.

 

The Office of Special Counsel sent a letter to the White House and Congress in the middle of last week, which included a June 2018 Army report which made the matter public for the first time.

 

A press release issued by Special Counsel Henry Kerner stated, “Whistleblowers play such a critical role in ensuring taxpayers’ money is not misused. In this case, because a whistleblower spoke up, the Army is now taking steps to recover assets worth more than a million dollars.” 

 

The anonymous whistleblower, a U.S. Army materiel command contracting representative, reported that a former U.S. Mission Installation Command director at Fort Rucker, Alabama, failed to secure six fuel trucks though the private company Primus Solutions. 

 

However, Kerner said that this former director “did not act unreasonably” because the original contracting officer did not follow the designated contracting procedure, and failed to provide sufficient documentation that would justify the purchase. 

 

The contracting officer “issued a modification to purchase six vehicles” to the firm-fixed-price contract. That action “was not part of the original score of this type of contract, which contributed to the government’s inability to quickly uncover the error and correct it,” according to the army.  

 

To recover the approximately $1.34 million loss, the Army is working to recover the fuel trucks. Additionally, audits are planned for the contract, and the Army is resolving the “ownership and title” of the trucks with Primus through the Armed Services Board of Contract Appeals, an independent forum that resolves contract disputes between the government and contractors.  

 

Kerner concluded, “the report meets the statutory requirements and the [Army’s] findings appear reasonable.”



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