Watchdog Furious Over Government Contracts for “Suspended” MCI

(Washington, D.C.)  Citizens Against Government Waste (CAGW) today chastised federal agencies for granting waivers allowing MCI, formerly WorldCom, to continue to receive federal contracts, despite the fact the company was suspended by the General Services Administration (GSA) in July for lacking “the necessary internal controls and business ethics.”

“This is the wrong message to send to corporate America,” CAGW President Tom Schatz said. “A company that committed the largest fraud in history ends up being punished on paper and not in reality. This contradictory action does not even amount to a slap on the wrist.”

In the year since the Securities and Exchange Commission launched its initial investigation into what was then WorldCom, the government has awarded MCI more than $1.2 billion in contracts. According to an article in today’s Washington Post, the suspension has been waived on at least seven occasions, allowing federal agencies to renew, extend, or replace existing MCI contracts. As a result, the government has granted MCI $100 million more in government contracts. The Defense Department is responsible for five of the waivers.

“The impression left at the time of the GSA suspension was that MCI was sidelined until the agency determined otherwise,” Schatz continued. “Now, it has been determined that the suspension was misleading at best. This is an outrageous development that raises major questions about how the federal government manages its procurement system.”

In the three months since MCI’s suspension, new evidence has emerged from whistleblowers and other sources of alleged over billing by the company at the Departments of Defense and State. In addition, the Justice Department has opened a fraud investigation into whether MCI acted illegally by rerouting calls to avoid paying as much as $1 billion in access fees to other phone companies since 1994.

“With all of these allegations of wrongdoing, one has to wonder what more MCI may be hiding,” Schatz concluded. “By granting waivers, the federal government is not only condoning MCI’s behavior, but rewarding it. GSA needs to permanently disconnect MCI through debarment and federal agencies need to follow such a decision, rather than subverting it and continuing to risk taxpayer dollars.”

CAGW has been calling for MCI’s debarment from government contracts since November, 2002 on the basis that the Federal Acquisition Regulations required such a conclusion, as well as that the agreements unnecessarily put taxpayer dollars at risk and amounted to a hidden government bailout of the company.

Citizens Against Government Waste is the nation's largest nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, abuse, and mismanagement in government.

"Citizens Against Government Waste is the nation's largest nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, abuse, and mismanagement in government."

I think they'd better go into a different line of work, because they sure as heck aren't any good at stopping those things.

Washington,DC is crazy,corrupt and government is so huge it is uncontrollable. The best thing that could happen in America is to clean Congress out.
All of these oversight committees dont do anything other than shuck and jive and every problem when addressed is passed around in circles with no one being held accountable.It is more about what party controls rather than what is best for America.
Our intelligence community and FBI is stocked with people who have so much influence and no telling how much adverse information they have on the politicians that no one can actually call their hands.
George Bush's greatest mistake is these Clinton holdovers and no telling how much information they are relaying back to the Clintons and subverting Bush and his administration.
The FBI file deal with Hillary shows how much contempt they have for those they cant control and to what extremes they will go to rule. Had that happened with the Republicans you can bet you would have heard screams of McCarthyism all over DC and from the "Mainstream Media". I truly believe our government is disintergrating from within and everyone up there is looking out for themselves and special interest.
China,North Korea and the Mid-east has infitrated DC and control it.The problem with the CIA goes all the way back to the USS Cole and the first bombing of the towers.Then China comes along and Clinton gives them everything they want and Clinton funneled money to North Korea to aid their nuclear capabilities while thinking he was buying them off.
Foreign Affairs in DC is like one big smorgasboard. Hell no one up there actually knows what is going on and between both Republicans and Democrats there is not one ounce of common sense.

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.