Federal Manager's Daily Report

A failed computer-programming project wasted $36 million

in federal retirement assets according Senate Governmental

Affairs Committee Chairman Susan Collins, R-Maine, and

ranking member Joseph Lieberman, D-Conn.


They announced the findings of an investigation into

problems with a four-year contract between the Federal

Retirement Thrift Investment Board and American Management

Systems to develop a Thrift Savings Plan record-keeping

system, according to a committee statement.


The senators recommended supervisory staff to be assigned

to future projects, that independent experts be consulted

to prevent the board from becoming too dependent on one

contractor, and that the board use better risk management

practices and contract structures.


The software AMS developed cost too much, was behind

schedule and proved nearly useless, causing FRTIB to enter

into a new contract with Materials, Communications and

Computers, Inc., in 2001 and spend an additional $33 million

to get a working system, which took 18 months.


In a letter to the FRTIB chairman, the senators wrote,

“while it is clear that AMS failed to produce a workable

system and repeatedly missed its own deadlines and cost

estimates, the Board should have taken more steps early on

to prevent this failure and to protect plan participants

and beneficiaries from paying the tab.”


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