Federal Manager's Daily Report

Report: Contracts could have been susceptible to procurement collusion due to the EPA’s lack of internal controls Image: Bob Korn/Shutterstock.com

The EPA is vulnerable to fraud and collusion among contractors because of “insufficient internal controls” and “poor data management,” the agency’s inspector general has warned.

The agency’s office of acquisition solutions “does not store and organize all of its procurement data in a manner that allows for proactive oversight and program management that could detect and prevent fraudulent, collusive behavior, such as bid rigging, price fixing, or other anticompetitive practices,” it said.

Since fiscal 2017 the EPA has awarded some 3,500 competitively bid, negotiated contracts worth more than $2 billion, the IG said, adding that it is “concerned that those contracts could have been susceptible to procurement collusion due to the EPA’s lack of internal controls.”

Detection of anticompetitive and collusive bidding requires examining all bid and proposal data and retaining the data in a format structured for analysis, such as in the FedConnect system, it said. However, the EPA “does not consistently use FedConnect to extract data fields from proposals, which results in unstructured data, like PDFs, being stored in the EAS in an unsearchable format. This is significant because the EPA’s poor data management renders the detection and prevention of anticompetitive and collusive conduct an unnecessarily arduous process.”

The report said the EPA has the ability to structure bid data in a way that would improve its oversight and further recommended stronger guidance and training of employees on detecting and preventing possible collusive behavior among contractors. Because the report was a management alert-type report, the IG did not solicit comments from the agency.

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