WASHINGTON - Rep. Ed Markey (D-Mass.) today asked the Department of Homeland Security to hand over documents, emails and other information as part of an investigation into the business dealings of EyakTek, an Alaska Native Corporation subsidiary, and its former director of contracts, Harold Babb, who was indicted last week for allegedly conspiring with contracting officers at the U.S. Army Corps of Engineers and an EyakTek subcontractor to inflate prices and pocket kickbacks. The scheme allegedly defrauded the government out of $20 million.
Babb previously headed EG Solutions, a DHS contractor partly owned by EyakTek that also allegedly defrauded the government. From 2007 through last year, DHS paid EG Solutions more than $200 million under the department's FirstSource contracting program, which set aside contracts for small businesses to provide a variety of IT products and services.
The Small Business Administration, however, concluded that EG Solutions and another company, MultimaxArray Firstsource, were acting as fronts for GTSI Corps., a large company that shared ownership of EG Solutions with EyakTek. Last fall, SBA suspended all three companies from receiving federal contracts. The revelations regarding the DHS and these companies were reported in an investigative piece by the Washington Post.
The House Natural Resources Committee has jurisdiction over Alaska Native Corporations and their subsidiaries, including EyakTek. Rep. Markey is the top Democrat on the committee.
"The Army Corps kickback scandal involving an Alaska Native Corporation subsidiary is quite alarming and merits closer investigation. I think we need to understand more about EyakTek's other contracts and work involving other federal agencies, as this incident may go beyond transactions with a single federal agency," said Rep. Markey. "Alaska Native Corporations should be representing their people, who are their shareholders. Based on last week's indictment of one company's director of contracts for alleged bribery in connection with an Army Corps of Engineers contract, and last year's suspension of an affiliated company for wrongdoing associated with a Homeland Security Department contract, there are real questions about whether this company is meeting its statutory and fiduciary obligations to its Native shareholders."
The full letter to DHS Secretary Janet Napolitano is HERE.
