Thread: Bay State congressmen decry Defense contracts to Bianco

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Bay State congressmen decry Defense contracts to Bianco
By ROB MARGETTA, Standard-Times staff writer

NEW BEDFORD — U.S. Rep. Barney Frank and Sen. John Kerry are blasting the Department of Defense for providing Michael Bianco Inc. with millions of dollars for military contract work at a time when other agencies were investigating the company for hiring illegal aliens.
"The military was utterly deficient," Rep. Frank said. "I had thought that the military was supposed to be more careful."
Last week, hundreds of federal agents raided the Michael Bianco plant, which produced backpacks and safety vests used by infantry and airmen, and detained more than 350 alleged illegal immigrants. Owner Francesco Insolia and three managers were charged with knowingly hiring illegal aliens.
Rep. Frank said a representative from one of Michael Bianco's competitors called him after the immigration raid.
"He said, 'Now I understand how they kept outbidding me,'"‰" the congressman said.
According to Department of Defense records, Michael Bianco was the low bidder for at least three contracts since 2005. Military sources said they have not yet completely broken off their relationship with the company.
The Defense Logistics Agency, which purchases common items used in all branches of the armed services, still expects Michael Bianco to produce 209,000 backpacks and components, although it has suspended Michael Bianco from future contracts.
Rep. Frank said the Michael Bianco incident is an example of a dysfunctional vetting system for qualifying military contractors.
"Does the military need to inspect contractors more carefully? Yes," he said. "Frankly, I didn't need this to show me that."
The military has hundreds of pages of regulations regarding the hiring of contractors, but Rep. Frank and Sen. Kerry, both Democrats, said the Department of Defense did not exercise diligence when it came to working with Michael Bianco.
"It only adds insult to injury to know that the Bush administration has been feeding this company a steady diet of lucrative defense contracts," Sen. Kerry said. "It calls into question not just how these contracts were awarded, but an appallingly apparent lack of communication between federal agencies.
"While the Department of Homeland Security was targeting a company for illegal hiring, the Department of Defense was filling its coffers with contracts."
Two federal agencies knew of problems at Michael Bianco: the Social Security Adminstration, which began noticing payroll irregularities in 2002 but could not alert the military due to privacy laws, and Immigration and Customs Enforcement, which found out about the case in 2006 and began an undercover investigation.
ICE was tipped off to the case by a Michael Bianco employee, and said its ability to use an operative posing as an illegal immigrant from Mexico looking for work was key to its investigation.
Spokesman Mark Foucart said ICE, which led last week's raid, has not investigated "the breakdown between the Department of Defense and Michael Bianco Inc.," but Defense Criminal Investigative Services, which handles military investigations, is looking into the case.
Michael Bianco drew The Social Security Adminstration's attention at about the time it began securing military contracts.
In 2002, when the company employed 83 workers, the SSA found that 23 percent of employees had Social Security numbers that were apparently fraudulent.
Over the next five years, the SSA sent letters to Michael Bianco about problematic payroll records, including Social Security numbers that belonged to adolescents or the dead. The only time Michael Bianco responded was in 2005, when it resubmitted 326 payroll records. Of those, 144 still came up as problematic, federal court records said.
By 2007, 66 percent of Michael Bianco's 646 employees were apparently using falsified Social Security numbers, according to the SSA.
Although the SSA said privacy regulations forbade it from sharing that information with other federal agencies, including the Department of Defense, Rep. Frank said the military should not have needed notification from the SSA.
"There is a confidentiality at Social Security that you want to preserve," Rep. Frank said. "But the military has its own responsibility to check up on these matters."
Exactly how much money the military awarded to Michael Bianco is still uncertain. The Department of Defense would not give a total last week.
The Defense Logistics Agency said it has given Michael Bianco $83.6 million in contracts since 2004. From 2001-02, the plant was awarded an additional $10 million in military money.
Department of Defense records show that the Army gave Michael Bianco $21 million "as part of a $138,562,131 firm-fixed-price contract" for backpacks, with a completion date of August 2010. The Army did not comment on the contract last week or say if it was connected to any of the Logistics Agency contract work.
Department of Defense spokesman Chris Islieb said the military can cancel open contracts if it needs to.
While he did not elaborate on how the military deems contractors qualified, he said they are expected to operate within the law.
"When the Defense Department enters into a contract with a company, we expect them to abide by the law," he said. "If someone is found guilty of a crime, we have a debarment process."
Contact Rob Margetta
at rmargetta@s-t.com

Date of Publication: March 11, 2007 on Page A04

http://www.southcoasttoday.com/daily/03 ... 5local.htm

Over the next five years, the SSA sent letters to Michael Bianco about problematic payroll records, including Social Security numbers that belonged to adolescents or the dead.

You mean the SSA has known about this problem for 5 years and has failed to do a darn thing about it. This is absolutely ridiculous! The SSA has got to start sharing this information with ICE, immediately.