Magazine article American Banker

OCC Broke Procurement Rules, Treasury Investigators Find

Magazine article American Banker

OCC Broke Procurement Rules, Treasury Investigators Find

Article excerpt

The Treasury Department's Inspector General is investigating how the Office of the Comptroller of the Currency buys products and contracts for services.

According to a 14-page interim investigation report obtained by American Banker, OCC managers violated federal procedures for, among other things, computer purchases, printing contracts, and reserving hotel rooms.

"To date, the investigation has disclosed that the OCC does not follow federal procurement regulations, as required," according to the Feb. 27 draft, which did not tally the violations' cost. A final report is expected by yearend, sources close to the investigation said.

Responding Monday, the Treasury released a short written statement that said: "To draw any conclusions based on this interim report would be premature."

The interim Inspector General report also alleges that the Comptroller's Office violated Small Business Administration rules governing minority contractors.

The OCC allegedly gave these vendors, under SBA's 8(a) program, detailed instructions on which computer products to purchase and where. However, the OCC still paid the vendors as much as 7% above cost, the report said.

"This investigation determined that the OCC used the 8(a) vendors as brokers to make purchases of computer equipment that the OCC acquisitions staff could have easily made," the document said.

Leonora S. Cross, deputy comptroller for public affairs, said that the agency had "very specific computer needs." She defended the agency by saying a Coopers & Lybrand audit of one 8(a) contract targeted by the investigation found no evidence of overpayment.

The interim report does not indicate how many 8(a) contracts are being investigated.

Whether the Comptroller's Office is subject to federal procurement rules has been debated for years, Ms. Cross said. …

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