Ottawa alleges contractor fraud, taking action to recover money | Power & Politics

We start today on those allegations of Contracting fraud the federal procurement Department says it has referred three cases of suspected invoicing fraud to the RCMP the estimated cost about $5 million prompting these questions to the Prime Minister today we now learn that there are $5 million in additional fraud that

Has been identified by the department the situation is obviously unacceptable which is why authorities are looking into this procurement process all federal contract s with these companies have been suspended as the investigation continues for more on this story I’m joined by the cbc’s Karina Roman here in

Ottawa so Karina uh quite the the unusual event for the government to hold a news conference today to outline allegations of fraud tell us more about what the government discovered here so these three individuals and they’re very clear we’re talking about people not companies we’re it subcontractors and I don’t even think

Double billing is the right word because we’re talking about 36 departments agencies corporations that they would build for the same work the same hours and this was between 2018 and 2022 um and as you said we’re talking about $5 million here that should not have been paid out uh so in they they

Said that at the beginning of the investigation which was actually years ago this is how long it took uh the security clearances for these individuals which is what allows them to do the work if you don’t have that you can’t work in the government um were stripped or suspended at that time

Uh and now they are stripped because it’s gone to the RCMP the RCMP has been asked to look into these three cases we asked how did this even come to your attention and it was a combination of a tip line that the government has but also data analysis uh looking for

Anomalies and patterns across uh but they don’t have a central data system for all the contracts so this is what they were able to catch with what they have um and as you said they are trying to recover the money but they also acknowledged that there could be more

Cases of this in fact five to 10 cases of possible fraud uh has been already flagged that they’re now starting investigations on and because they plan to be more proactive in looking for this in the data and in the contract uh database uh and because Anita nand announced a horizontal audit as she

Called it you know across all contracts uh that’s going to be undertaken there could even be more cases found yeah double triple billing I don’t even know what the multiplier is across 36 specific departments but it kind of highlights problems with the it systems inside government they’re in ability to

Sort of see these duplicate uh Billings I I mean how are they dealing this because we’ve seen all these issues around other subcontractors and contractors that committee on things around arrive can I mean what are they doing here to to clamp down on potential fraud like what they say has happened

Here so they’ve announced a new oversight office called the office of supplier integrity and compliance but it’s not just sort of a central oversight office it’s also new measures that they say they’ll bring in to clamp down and really tighten what they say what seems to be quite a porous system

Um so right now they have this what they call Integrity regime but they can only revoke uh security clearances and the ability to to work uh as a subcontractor if they face a criminal charge uh or a conviction and on a limited number of types of charges and conviction not just

Anything um and so they now say they’re going to broaden that a wider set of offenses and misconduct will would would disqualify you from being uh cleared to to be a subcontractor and more jurisdiction so now if if it’s in another province that it happens or if

It’s even in another country like a trading partner now that would also qualify you to lose your security clearance um and and be debarred as they called it okay that’s an interesting move now look people are going to see this allegations of fraud on Contracting you know contractors subcontractors and

They’re going to think this sounds a lot like what’s been going on with arve can and the things we’ve been hearing at those committees is there a connection here what’s the connection here with any of those uh issues specifically they insist they said we’ve asked multiple times no connection with these three

Individuals and the arrive can app okay so that’s they’ve said but if you look at the broader picture and certainly these questions came up at the news conference um arrive can is a high-profile example of a system that isn’t working uh procurement wise and and well procurement the word sometimes

Makes people’s eyes glaze over we’re talking about taxpayers money being spent on goods and services uh on contracts that you know outside of the public service but it’s the public service and the managers that determine who gets these contracts so um I think it shows that there’s a wide more

Systemic problem and that was acknowledged uh by the ministers that this is why they’re bringing in these new measures to really try and tighten this system uh new guidelines for managers things that will become mandatory um you get a sense that they acknowledge it maybe up to this point

Has been a bit Loosey Goosey you know and this is really so it might not be tied directly to rcam but it’s just one more example of a problem that’s across the government that they need to do something about yeah there are vulnerabilities in there and they’re being exploited in some fashion all

Right Karina thank you so much this is cbc’s Karina Roman here in Ottawa

Canada’s federal procurement department says it has referred three cases of suspected invoicing fraud by IT subcontractors to police and is taking action to recover the money. The scheme allegedly involved 36 federal departments, agencies and Crown corporations.

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