US: Report Finds Air Force Officers Steered Contract

[Joanne98]

by Josh White, Washington Post
April 18th, 2008





Sitting at the head of the table, Air Force Maj. Gen. Stephen Goldfein, the highest-ranking officer in the room, leaned forward and told the officers and others assembled before him that they should steer a multimillion-dollar Air Force contract to a company named Strategic Message Solutions.

"I don't pick the winner, but if I did, I'd pick SMS," Goldfein said to the seven-person group that was selecting a contractor to jazz up the Air Force's Thunderbirds air show with giant video boards, according to a lengthy report by Defense Department's inspector general. The head of the selection team almost immediately "caved," giving in to what he believed was a fixed process, while another member of the team called it "the dirtiest thing" he had ever experienced.

It was during that meeting in November 2005, according to the 251-page report, obtained by The Washington Post, that a controversial $50 million contract was awarded to a company that barely existed in an effort to reward a recently retired four-star general and a millionaire civilian pilot who had grown close to senior Air Force officials and the Thunderbirds.

In a probe that lasted more than two years, investigators concluded that Goldfein and others worked inside the Air Force contracting system to favor SMS and its owners, despite an offer by the company that was more than twice as expensive as a competing bid.

Goldfein, who is now vice director of the Pentagon's Joint Staff, was found to have gone to great lengths to see the contract awarded to SMS, while senior Air Force leaders socialized with the company's partners. According to the report, Goldfein even arranged for President Bush to record a video testimonial in the White House Map Room that was included in the SMS contract proposal, demonstrating the company's credibility and access.

The report offers a blow-by-blow account of how a small Air Force contract spun out of control, highlighting conflicts of interest in the selection process, officers stacking the deck in favor of friends, and others influencing a system designed to eliminate such favoritism in spending taxpayer dollars.
http://www.corpwatch.org/article.php?id=15012