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Wednesday, April 22, 2009

SBA Executive Covered Up Billions In Fraud and Abuse

April 22, 2009

Petaluma, Calif. - Since 2003, a consistent flow of federal investigations have been released which have found the Small Business Administration (SBA) has allowed billions of dollars in federal small business contracts to be diverted to Fortune 500 firms.

Several of the investigations found large businesses had committed fraud in the form of "vendor deception" and "false certifications" to illegally take billions of dollars in federal small business contracts.

Most of the nation's largest newspapers and television networks such as ABC, CBS and CNN have covered the story. (ABC,; CBS,; CNN,

Despite irrefutable evidence indicating that Fortune 500 firms were receiving thousands of federal small business contracts, SBA Press Office Director Mike Stamler launched an aggressive campaign to cover up the fraud and abuse, and stop any media coverage on the issue.

Stamler assailed any journalist who dared to tell the story of the SBA's involvement in the widespread abuses. A number of journalists reported receiving Stamler's profanity riddled emails on a regular basis. After receiving one of Stamler's profanity laced communications, the Long Island Business Journal (LIBJ) posted an article on its blog titled, "Expletives the SBA's Forte."

The SBA's own Office of Inspector General has released several scathing reports describing the rampant fraud and abuse as, "One of the most important challenges facing the Small Business Administration and the entire Federal government today…"

Stamler responded by intensifying his campaign to intimidate journalists into dropping the story, and by launching a campaign to convince the public that the staggering abuses in small business contracting programs were nothing more than a "myth."

Lloyd Chapman, President of the American Small Business League (ASBL), prompted the initial U.S. Government Accountability Office (GAO) investigation into fraud and abuse in SBA contracting programs. Additionally, Chapman has won a series of Freedom of Information Act (FOIA) lawsuits against the SBA forcing the agency to release thousands of pages of documents, which prove Fortune 500 firms were receiving billions of dollars in federal small business contracts.

After several journalists complained to the ASBL that Stamler had libeled and slandered Chapman, the ASBL requested Stamler's e-mails and phone records under FOIA.

The SBA has refused to release Stamler's phone records, and the ASBL has filed suit in United States District Court, Northern District of California. The ASBL plans to file an additional suit against the SBA to obtain all of Stamler's e-mails in preparation for a suit against Stamler and the SBA for libel and slander.


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