Wealthy Enriched by Double-Dipping U.S. Plan

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http://www.bloomberg.com/news/2012-02-21/wealthy-enriched-by-double-dipping-u-s-plan.html

In April 2003, Piyush Agrawal deleted his son’s name as president of APS Technologies Inc. He replaced it with his own on a hand-written filing with the Florida Department of State.

That made the 66-year-old retired educator the sole officer and director of the firm and separated its management from a medical supply company run by Agrawal’s two sons. Three months later, he followed his sons into a U.S. program that steers government business to the “socially and economically disadvantaged.” It was the Agrawal family’s second time obtaining federal assistance under a benefit that prescribes that immediate family members should participate only once.

The New Delhi immigrants have grown rich on $256 million in government contracts since 1993 through a web of family-owned companies. The Agrawals are still in the nine-year program today, 18 years after first qualifying.

They are among 12 repeat participants that have received $412 million in preferential contracts, and more than $1 billion in total government awards, based on data compiled by Bloomberg. Because of opportunistic entrepreneurs and lax government overseers, even the wealthy profit from a taxpayer-supported program designed to bolster underprivileged segments of society.

“Legitimate small businesses are put at a huge competitive disadvantage when bad actors lie about their small business status and don’t play by the rules,” Representative Sam Graves said in a statement. The Missouri Republican is chairman of the House Small Business Committee. “We owe it to American taxpayers to make sure that contracts intended for small businesses go to small businesses.”