Release: Pentagon Spent Billions on Contractors that Committed Fraud

WASHINGTON, Feb. 2 - In a report prepared for Sen. Bernie Sanders, the Department of Defense disclosed that it paid $285 billion over a three-year span to hundreds of military contractors that defrauded the Pentagon during the same period.

"With the country running a $14 trillion national debt, my goal is to provide as much transparency as possible about what is happening with taxpayer money," said Sanders (I-Vt.). "The sad truth is that virtually all of the major defense contractors in this country for years have been engaged in systemic fraudulent behavior, while receiving hundreds of billions of dollars of taxpayer money."

The preliminary report detailed how the Pentagon spent $270 billion from 2007 to 2009 on 91 contractors involved in civil fraud cases that resulted in judgments of more than $1 million. Another $682 million went to 30 contractors convicted of hard-core criminal fraud in the same three-year period. Billions more went to firms that had been suspended or debarred by the Pentagon for misusing taxpayer dollars.

A Sanders provision in a defense spending bill required the report and directed the Department of Defense to recommend ways to punish fraudulent contractors. The Pentagon brass saw no need for any changes. "The department believes that existing remedies with respect to contractor wrongdoing are sufficient," the Report to Congress on Contractor Fraud concluded.

"It is clear that DOD's current approach is not working and we need far more vigorous enforcement to protect taxpayers from massive fraud," Sanders said.

Under a separate Sanders provision in another law signed by President Obama, a government-wide federal contractor fraud database will be accessible to the public by April 15.  Until now, access to the Federal Awardee Performance and Integrity Information System was limited to federal acquisition officials and certain members of Congress.

To read the Pentagon report, click here.

To read a Sanders staff analysis of the report, click here.