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More irregularities found in Nellis contracts

The Defense Department inspector general’s investigation that led to the disclosure last week that Air Force officials steered a $50 million contract to a firm that was well connected with the Air Force has spawned a separate, broader audit of contracts awarded by the 99th Contracting Squadron at Nellis Air Force Base, Nev.

A spokesman for the IG’s office confirmed Monday that an audit is ongoing.

The investigation into the $50 million contract to produce a multimedia presentation for Thunderbirds air shows in 2005 and the separate, subsequent audit have turned up evidence of irregularities in several more contracts related to the Thunderbirds, according to the IG report released Thursday.

Those irregularities include accusations that private firms performed work before contracts were awarded and that Air Force contracting personnel backdated documents, according to the report.

Air Force officials at the Pentagon did not immediately respond to a request for comment, but they typically do not comment on ongoing investigations.

Five Air Force personnel — including Air Force Maj. Gen. Stephen Goldfein, the vice director of the Joint Staff at the Pentagon — were reprimanded for their roles in steering the December 2005 Thunderbirds contract to Strategic Message Solutions, a firm headed by Ed Shipley, a longtime friend of the Thunderbirds, and Gen. Hal Hornburg, who had recently retired as commander of Air Combat Command.

The report faults the entire process by which the source selection team at Nellis chose Strategic Message Solutions and singles out Goldfein, then commander of the Air Warfare Center at Nellis, as the individual most responsible. Goldfein had been friends with Shipley since the 1990s, the report says.

“The investigation found that the ... award to [Strategic Message Solutions] was tainted with improper influence, irregular procurement practices and preferential treatment,” the report says. “Goldfein’s activities displayed a pattern of behavior that gave an advantage to SMS ... and so constituted preferential treatment. ... In short, we believe that the source selection process may not have selected SMS absent his influence.”

The result, according to the report, was that SMS — despite existing only on paper — was chosen over a competitor that was graded equal or superior in all but one evaluation category and offered to do the work for $24.9 million, half of what SMS bid.

Goldfein, in interviews with investigators, denied any wrongdoing. He said he did not steer the contract to SMS.

He has not responded to requests for comment.

The Air Force nullified the contract with SMS in February 2006 after one of the losing bidders filed a protest with the Government Accountability Office and an initial review by the Air Force found evidence of wrongdoing.