The U.S. Small Business Administration (SBA) has stripped the U.S. Agency for International Development (USAID) of its independent authority to award 8(a) contracts following a hefty bribery scandal. The SBA, under the helm of Administrator Kelly Loeffler, made the announcement after a Department of Justice probe unearthed corrupt practices to the tune of $550 million involving a USAID contracting official and two 8(a) contractors.
"Under the Trump Administration, the SBA will not tolerate the abuse of the government contracting process," Loeffler said, as reported by the SBA's website. Boiling it down, USAID can no longer independently throw money to 8(a) certified businesses, which last fiscal year amounted to $3.6 billion worth of contracts, all due to findings of "waste, criminal fraud, and bribery." The irony is thick, considering one of the contractors flagged for lacking "honesty or integrity" still landed an $800 million deal to study migration from Central America.
The SBA's aggressive move to revoke USAID's authority also comes with a promise of an exhaustive audit of the 8(a) Business Development Program, which aims to help disadvantaged small businesses navigate federal contracting. Loeffler ordered the review to cover all high-dollar and low-competition contracts from the past 15 years, and results will be funneled to the SBA Office of Inspector General and the DOJ.
Loeffler's mandate made it clear: Any corruption uncovered will be met with full force, the SBA will pursue every possible measure to retrieve misappropriated funds. As part of its broader mission to foster entrepreneurship, the SBA serves as a beacon, providing resources and support to small enterprises.
