By Debbie Gregory.

A 53-year-old business owner and a 57-year-old service-disabled vet have pleaded guilty to engaging in a pass-through scheme designed to fraudulently land $13.8 million in federal contracts set aside for veteran-owned small businesses.

Jeffrey Wilson and his partner in crime, Paul Salavitch, hatched a “rent a vet” scam that led to the charges.

By listing Salavitch as the person responsible for the day-to-day operations of Patriot Company, a construction business owned by Wilson, they were able to leverage Salavitch’s disabled status to access lucrative contracts that the company otherwise wouldn’t qualify for.

As a result, the company 20 government contracts worth almost $14 million, with some worth as much as $4.3 million apiece.

The fraud was uncovered in 2013, when the Department of Veterans Affairs visited Patriot Company’s headquarters unannounced. Of course, Salavitch was nowhere to be found; Salavitch had a job as a federal employee with the Department of Defense in Leavenworth and did not actively run the company, located in Kansas City.

Salavitch told the Missouri Division of Purchasing and Materials Management that Patriot Company was a “legitimate service-disabled veteran-owned small business,”  knowing that it wasn’t.

Under the terms of their plea agreement, Wilson now faces a sentence of up to 18 months in prison without parole. Salavitch faces up to one year in prison without parole. Both also consented to a civil forfeiture agreement of about $2.1 million.

While thousands of combat wounded and service disabled men and women work hard to succeed in American business, corrupt business owners continue to defraud the U.S. government by falsely claiming they are eligible for these set-asides.

When these fraudsters illegally secure SDVOSB contracts, our nation’s taxpayers and legitimate service-disabled veteran-owned small businesses suffer.


By Debbie Gregory.

The Supreme Court came down on the side of veteran business owners by finding that the Department of Veterans Affairs (VA) failed to comply with a law aimed at increasing the number of federal contracts awarded to veteran owned small businesses.

The justices sided with Kingdomware Technologies Inc., a service disabled veteran-owned contractor based in Maryland that said it should have been considered to provide services for a VA medical center.

The issue before the Court was whether a federal law which provides that, as long as certain conditions are met, the Department of Veterans Affairs “shall award” contracts to small businesses owned by veterans applies every time the department awards contracts.  The federal government had argued that the rule left some room for discretion, but on June 16th, the Court rejected that argument.  “Shall,” the Court emphasized, was meant as a command, not an option.

The case dates back to 2012, when the VA awarded a contract for an emergency notification system that would send information to its employees, to a company that was not owned by a veteran. Kingdomware, which is owned by a U.S. Army veteran who was permanently disabled from an injury that he suffered while serving in 1991’s Operation Desert Storm, challenged the award. Kingdomware provides web, software, and technology solutions to enterprise problems.

Federal law requires the agency to use a bidding process if two or more disabled veteran-owned companies can offer service at a fair and reasonable price. But the VA argued the “rule of two” does not apply when it buys goods and services from vendors that already have contracts with the agency under a system called the Federal Supply Schedule.

Justice Clarence Thomas said the rule applies to all contract determinations.

A federal appeals court had said the VA did not have to follow the rule of two if it otherwise met the goal of awarding between 7 percent and 12 percent of all contracts to companies owned by disabled veterans. But Thomas said meeting annual benchmarks does not allow the VA to ignore a mandatory contracting rule

Veteran-owned small businesses see the ruling as a victory that gives them more opportunities to compete for contracts from the VA which, they would say, is exactly what Congress intended.

govt contract

HMS Technologies has been awarded one of only ten Service Disabled Veteran Owned Small Business (SDVOSB) contracts by the Department of Veterans Affairs (VA).

The contract is for the VA’s Transformation Twenty-One Total Technology Next Generation program, or T4NG. The contract will enable HMS to provide the VA and its employees an avenue to offer veterans, worldwide, the means to quickly access the Department for their specific IT needs, expedite service delivery, and improve filing and speed of processing claims.

“The entire HMS Team is honored to receive this award and we are excited about having this contract vehicle so we can continue to provide VA the Information Technology services that will enhance services that support our veterans,” said HMS CEO Bill Kirkpatrick. “We look forward to continuing our partnership with the VA to serve our nations heroes.”

HMS ranks 68th on the Federal Government’s list of Top 100 Government-wide Acquisition Contractors and was also named SBA’s Small Business of the Year for 2008 in WV.

With an anticipated ceiling value of approximately $22.3 billion, T4NG is the largest Indefinite Delivery/Indefinite Quantity contract awarded out of the VA. The T4NG program will replace the original T4 multiple-award contract that expires in June 2016.

HMS was founded in 2003 and is headquartered in Martinsburg, WV.


By Debbie Gregory

Each year, government entities such as the Department of Veterans Affairs (VA) set aside contracts specifically for companies owned by Veterans. There are even stipulations for large companies to subcontract out to Veteran-owned businesses in order to be awarded certain contracts. Up until just a few years ago, any business owner could win government contracts and subcontracts through larger corporations by merely checking a box on a form stating that their firm was a Veteran-owned business­. There was no follow-up, and no one checked.

Today, firms wanting to utilize procurement opportunities through the VA must be verified through the Center for Verification and Evaluation (CVE) as a Veteran-Owned Small Business (VOSB) or a Service-Disabled Veteran-Owned Small Business (SDVOSB).  The verification program was established to reduce the number of businesses that were fraudulently claiming a Veteran-owned status. The program also serves to protect the competitive edge that the set-aside contracts provide to Veteran-owned small businesses.

The verification program utilizes a meticulous process to ensure that businesses claiming to be either a VOSB or a SDVOSB are in fact owned and controlled by a Veteran, or multiple Veterans. The CVE has established a Verification Assistance Program (VAP) that helps Veteran business owners through the process.

The key function of VAP is application assistance. To accomplish this function, the CVE has developed a partnership to grow and sustain an inventory of VA certified verification assistance counselors. These individuals, located throughout the country, provide “no-cost” assistance to Veterans throughout the verification application process. Veterans have admitted to paying as much as $20,000 for similar services.

The CVE has also begun hosting Verification Program webinars and virtual town halls to provide comprehensive information to potential new applicants, firms re-verifying, and those who have achieved verification.

The schedule of webinars includes:

  • 1st Tuesday of each month – Preparing for Re-verification Webinar & Town Hall
    • This training is designed for firms whose verification will expire in 5 months or thirty days.
  • 3rd Tuesday of each month – Pre-Application Webinar & Town Hall
    • This training is designed for firms interested in submitted their first CVE Verification application. Also, firms who have been inactive in the program for some time and now desire to submit an application can also benefit from this session.
  • 4th Tuesday of each month – How to stay Verified Webinar & Town Hall
    • This training is designed for firms who have been verified in the last six months.

To learn more about CVE and the verification program, please connect via

The Veteran and Military Business Owners Association (VAMBOA) is a non-profit business trade association that promotes and assists Veteran Business Owners, Service Disabled Veteran Owned Businesses (SDVOB) and Military Business Owners. Small businesses are the backbone of our economy and responsible for job generation. That is why VAMBOA provides its members with Business Coaching, Contracting Opportunities, a Blog that provides information, Networking contacts and other resources. Membership is FREE to Veterans. Join Now!

VAMBOA: Make Sure Your Company is a Verified Veteran-Owned Business: By Debbie Gregory

Recently, the U.S. House of Representatives passed the 2015 Defense Authorization Act (NDAA.) The House’s version of the act intends to transfer the Service Disabled Veteran-Owned Small Business (SDVOSB) verification responsibility from the VA to the U.S. Small Business Administration (SBA).

Currently, the VA’s Office of Small and Disadvantaged Business Utilization (OSDB) is responsible for the verification. The OSDB runs SDVOSB verification through their VetBiz website at

Under the version that the House just passed, the VA would be directed to use the SBA’s definition of a SDVOSB until the transfer of responsibilities to the SBA is complete. In the past, the requirements to qualify as a SDVOSB has varied, depending on whether an acquisition falls under the VA’s or SBA’s SDVOSB rules. Requiring both agencies to use the same definition could resolve a major problem.

But if the Senate passes the bill without amending it and the president signs off, the VA would not use the SBA’s definition for long. As it stands, the bill requires the VA to enter into a Memorandum of Understanding with the SBA within 180 days, under which the VA will transfer control and administration of the SDVOSB verification program to the SBA.

The current NDAA in the Senate specifies that the SBA’s Office of Hearings and Appeals would be responsible for all appeals regarding denied verifications or appeals from SDVOSB status protests under VA set-aside contracts. The bill currently does not specify whether SDVOSB status protests would be decided by the SBA, or continue to be settled by the VA.

It is likely that the House-passed NDAA will not make it through the Senate without changes. If so, the NDAA for fiscal 2015 will not be enacted until a House-Senate conference committee can reach an agreement.If the Senate agrees, and the President signs the bill into law, the process of transferring SDVOSB verification from the VA CVE to the SBA could begin later this year.

Veteran small business owners and Service-Disabled small business owners should pay attention to how the FY 2015 NDAA plays out. It could mean big changes are in store.

The Veteran and Military Business Owners Association (VAMBOA) is a non-profit business trade association that promotes and assists Veteran Business Owners, Service Disabled Veteran Owned Businesses (SDVOB) and Military Business Owners. Small businesses are the backbone of our economy and responsible for job generation. That is why VAMBOA provides its members with Business Coaching, Contracting Opportunities, a Blog that provides information, Networking contacts and other resources. Membership is FREE to Veterans. Join Now!

VAMBOA: House Bill Could Change SDVOSB Law: By Debbie Gregory