Government Bars Supplier For Made-In-USA Fraud
April 5, 2011
lengthy investigation, Illinois-based supplier EPS Solutions (asi/51198) has
been placed on the federal Excluded Parties List, prohibiting the company from
receiving government contracts for a still undetermined period of time. The
action was taken against EPS and its owner Jeffrey Richardson after the
supplier allegedly provided the U.S. Army with beach towels that were produced
overseas, in violation of the Buy American Act and the Berry Amendment.
on a preponderance of the available evidence, Mr. Richardson supplied the Army
with an inferior product," officials wrote in a memo obtained by
Counselor. "A preponderance of the available evidence shows Mr. Richardson
made false statements during the investigation."
to Army documents, EPS Solutions was awarded a contract to produce 60,000
towels in September 2009 for a total cost of $388,200, or $6.47 per item.
Believing the bid price was extremely low for 100% U.S.-made towels,
competitors of EPS unsuccessfully protested the awarding of the bid. It wasn't
until March 2010 – when EPS offered a questionable pre-production sample that
did not include a tag showing product origin – that an investigation was
launched. Evidence later showed the towel sample was produced outside of the U.S. and Richardson intended to complete the order with
in-stock materials that were essentially a mixture of foreign towels. "Mr.
Richardson admitted that the pre-production towel was in fact of Pakistani
origin," the memo states.
2010, Army investigators questioned Richardson in greater detail, finding he had
altered information on his computer, attempting to avoid further suspicion.
"Mr. Richardson obstructed a federal investigation by means of falsifying
records in an effort to conceal his crimes," officials wrote.
month, EPS and Richardson were placed in proposed debarment status pending a
formal determination by a government official. According to the Army, EPS can
protest the allegations and can request a hearing. Multiple calls placed to Richardson by Counselor have not been
returned. It is unknown whether criminal charges will be filed, as FBI and Army
Fraud Division officials have refused comment on the matter at this time.