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Post by Tim Collins on Feb 3, 2009 13:32:54 GMT -7
Missouri Attorney General Launches State-Wide Office Depot Investigation
ALEXANDRIA, Va., Feb. 3 /PRNewswire-USNewswire/ -- The Attorney General's Office for the State of Missouri has announced it has opened a state-wide investigation of Office Depot regarding allegations of fraudulent pricing and overcharging on government contracts.
The National Office Products Alliance (NOPA) observed that these announcements follow the opening of two other state investigations of similar allegations within the past year. In Florida, the Attorney General's Office announced its ongoing investigation in May 2008 and North Carolina opened an investigative audit on October 28. All three investigations are based on the testimony of David Sherwin, a whistleblower in Florida, where Office Depot is headquartered.
These investigations concern allegations associated with Office Depot's participation as the sole vendor on the "U.S. Communities" national contract for office and classroom supplies. The annual value of that contract is estimated at $600-700 million. State, county and municipal government agencies and school districts in all 50 U.S. states participate in that contract.
In recent years, this contract has supplanted long-term business relationships that small independent office product dealers enjoyed with local governments and school districts. More recently, several state governments also have made use of the U.S. Communities contract as a new purchasing option for state agency employees.
In some cases this step has been taken as an alternative to rebidding state office supplies contracts - a decision that has prevented independent dealers from fairly competing for government business, while denying government agencies and taxpayers the benefits of ongoing competition. In addition, a growing number of hospitals and universities have taken this non-competitive approach and increasingly rely on sole-source contracts with national companies - often without auditing them on a regular basis.
Bob Chilton, NOPA chairman and president, Supply Division of The Phillips Group, said, "The rationale for sole-source contracting - that it will result in 'best value' for government and institutional customers - should be questioned rigorously given the expanding number of state and local government audit results and investigations that suggest the contrary is true." He added, "NOPA continues to advocate for more, not less, competition that includes independent small businesses in our industry, with consistent multiple contract awards to ensure there is ongoing, daily competition for government business"
About Us: NOPA is the trade Association for independent office products dealers and their trading partners. For information, contact Chris Bates, NOPA President at cbates@nopanet.org or 800.542.6672.
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rosa
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Post by rosa on Feb 4, 2009 9:29:46 GMT -7
dumb question: oversight?
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Post by Tim Collins on Feb 4, 2009 10:30:55 GMT -7
Basically there is none. The Office Depot contract is just an example. Grainger just settled with the Justice Dept. for $6 million for over charging the Post Office in violation of their GSA Contract. Ofiice Depot has been charged or investigated by multiple states.
These contracts are intended to streamline the procurement process by eliminating the requirement for annual bids - within $ limits. What they end up being is a barrier to small businesses that do not have the capital to maintain large inventories of many products. Procurement agents simply buy what they want off these multi-state or national contracts and locals are either not given an opportunity (why get local pricing when someone is already holding a price contract), or told - sorry we have to buy under existing contracts.
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rosa
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Post by rosa on Feb 4, 2009 11:45:39 GMT -7
Basically there is none. The Office Depot contract is just an example. Grainger just settled with the Justice Dept. for $6 million for over charging the Post Office in violation of their GSA Contract. Ofiice Depot has been charged or investigated by multiple states. who bears the brunt of legal fees? just curious
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Post by Tim Collins on Feb 4, 2009 11:51:57 GMT -7
No idea how the legal fees work. I imagine states and municipalities pay up front then try and recover after the fact in any settlement
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rosa
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Post by rosa on Feb 4, 2009 11:58:47 GMT -7
No idea how the legal fees work. I imagine states and municipalities pay up front then try and recover after the fact in any settlement so then in a round about way, the taxpayer pays for it
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Post by Tim Collins on Feb 4, 2009 15:20:25 GMT -7
www.usdoj.gov/opa/pr/2008/July/08-civ-653.htmlFOR IMMEDIATE RELEASE Friday, July 25, 2008 WWW.USDOJ.GOVCIV(202) 514-2007 TDD (202) 514-1888 W.W. Grainger Pays United States $6 Million to Resolve False Claims Act Allegations WASHINGTON — W.W. Grainger Inc. has paid the United States $6 million to settle allegations that it submitted false claims to United States government agencies, the Justice Department announced today. The company, based in Lake Forest, Ill., supplies facilities maintenance and other related products in North America. The settlement resolves allegations that the company sold government agencies special order items at a markup greater than that allowed by Grainger’s contract with the General Services Administration (GSA). The settlement also resolves allegations that Grainger sold government agencies products from countries that do not have reciprocal trade agreements with the U.S., such as China and Taiwan. Grainger was required by its contract with the GSA and by the Trade Agreements Act to prevent such items from being offered for sale to U.S. government agencies. "Federal contractors will be held accountable for their knowing violations of procurement regulations," said Gregory G. Katsas, Assistant Attorney General of the Department of Justice's Civil Division. "This settlement is an example of the Department’s determination to ensure that federal funds are protected from fraud and abuse." The case was filed under the qui tam provisions of the False Claims Act by Brian M. Holbrook, a former Grainger employee, in the U.S. District Court for the Eastern District of Wisconsin in January 2006. Holbrook will receive $70,400 of the total recovery as his statutory award. Under the qui tam provisions of the False Claims Act, private parties can file an action on behalf of the United States and receive a portion of the proceeds of a settlement or judgment awarded against a defendant. "The Civil Division of the U.S. Attorney’s Office is committed to actively pursuing allegations of fraud by companies against government agencies," said Steven M. Biskupic, U.S. Attorney for the Eastern District of Wisconsin in Milwaukee. "This settlement is another example of the Civil Division’s continuing efforts to investigate and prosecute affirmative civil matters." The settlement resulted from an investigation by the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Eastern District of Wisconsin and GSA’s Office of the Inspector General.
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Post by Tim Collins on Feb 4, 2009 15:23:52 GMT -7
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rosa
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Post by rosa on Feb 4, 2009 15:49:02 GMT -7
Good Lord! No, thanks, I'm good.
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Post by Tim Collins on Feb 4, 2009 16:14:51 GMT -7
Note the little pay out to the whistle blower. If I am not mistaken he was eligible ofr 10% of the fine - looks like Grainger cut him a deal to accept less
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rosa
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Post by rosa on Feb 4, 2009 16:19:05 GMT -7
well, it's not safe to do it in the first place, snil
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rosa
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Post by rosa on Feb 27, 2009 5:11:20 GMT -7
from what I remember, it's "easier" if you have friends on city council...is that true too, or are we just talking present and past board members? Um, isn't this one of those things the mayor said he was working to eliminate? The name David Escobar springs to mind, and I don't think he was the only one. I think he's the only one who got caught........
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herb
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Post by herb on Mar 1, 2009 1:32:24 GMT -7
You think the politicos DON'T know much about these things? Politicians are inherently selfish by nature. They will generally not do anything about anything where there is not some solid political payoff for themselves in it, or where there may be some political risk for themselves.
And the higher levels only make a pretense of overseeing governments/local agency operations. They are not really interested in hearing about major problems and issues. Slap a hand here and there if you must, but don't even THINK about opening Pandora's box!
Think about it for a moment: You are at a higher level and responsible for monitoring, oversight, and corrective action where necessary. The one thing you DON'T want to hear from those over you is, "You mean all of these things happened under YOUR watch?" You don't want to admit that you have not really been watching, as that could threaten your own position. So it is in your own personal interest to ignore, downplay, sidestep, and minimize major problems whenever you can. You were supposed to be watching and you weren't. Whatever you do, don't admit it!
Often as not, the one who finally exposes the major problems is the one who ends up being attacked, even by you! After all, exposing problems that YOU should have known about is a personal threat to you!
THAT is the way, unfortunately, that much of our government works, and it is true of both Republicans and Democrats.
How can you tell when a politician (or government bureaucrat) is lying?
His mouth is moving.
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aslyn
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Post by aslyn on Mar 1, 2009 2:07:27 GMT -7
I share your cynicism. I am reminded of the flip side of an old 45 rpm record by Dr. West's Medicine Show and Junk Band. The main side was "The Eggplant That Ate Chicago" and the flip side was "You Can't Fight City Hall Blues."
"You can't fight city hall, baby you ain't gonna win... you're gonna lose... you're gonna wind up with those city hall blues."
To take another tack, I think we can draw a lesson from Jesus Christ (not meaning to sound overly religious, which I am not):
He who would stand steadfast for that which is right must be prepared to be crucified. It is bound to happen, and if you can't handle it then maybe you should not take the stance.
I have been crucified more than once. It hurts! And it teaches you to be careful and choose your battles wisely.
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rosa
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Post by rosa on Mar 2, 2009 21:10:31 GMT -7
you know, I think we pretty much have city and county representatives who rubber stamp each others' agendas--all of this so-called "progressive youth"
it is really that naive to expect them to represent their constituents instead of each others' agendas?
you're making a mistake if you assume I ever trusted Escobar. I keep hearing stories (I don't know if they are true or not, but I worry when I hear these things) about how "concerned" Escobar is about the citizens, how she wants to hear what people have to say
but when someone asks her a good question, what she asks in return is: "Who said that?" "Who is that person?"
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