§638b Reducing Vulnerability of Sbir and Sttr Programs to Fraud, Waste, and Abuse

Summary

Require the Administrator to change the SBIR and STTR Policy Directives within 90 days after December 31, 2011 to add rules that stop fraud, waste, and abuse. The changes must include simple definitions of fraud/waste/abuse, rules for watching and checking applicants and awardees, a requirement that each participating agency puts its Inspector General’s fraud-reporting method (hotline or website) on the agency website and in funding notices, and a rule that applicants and awardees must certify they follow the program laws and conduct rules. The Administrator must work with the Council of Inspectors General on Integrity and Efficiency and get public comment before setting the certification process. The certification can cover the whole award life, require proof of the principal investigator’s main job, proof the business meets the small-business rules and did the work, disclosure of any identical or essentially equivalent SBIR/STTR applications or awards, and a promise that work was done at the company’s facilities by its employees unless stated otherwise. Require the Inspectors General of participating agencies to work together to spot fraud by creating detection indicators, reviewing rules and procedures, sharing information where allowed, and improving training and outreach to program staff, applicants, and awardees. Require the Comptroller General (GAO) to study, within 1 year after December 31, 2011 and every 4 years after that, how well agencies put these changes in place and how effective their systems, risk plans, tech tools, Inspector General work, and public databases are at finding duplicate projects and fraud, then send a report to the Senate Committee on Small Business and Entrepreneurship, the House Committees on Small Business and on Science, Space, and Technology, and the heads of the participating agencies. Require each agency Inspector General, by October 1 each year, to report to those same congressional committees the number of SBIR/STTR fraud-related cases referred in the past year, what actions were taken (or why none were taken), and how funds and resources were used or recovered to address fraud, waste, and abuse.