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Inspection Report: INS-O-13-01

November 5, 2012

Allegations of Organizational Conflicts of Interest at Portsmouth and Oak Ridge

The integrity of the Federal acquisition process is protected, in part, by Organizational Conflicts of Interest (OCI) rules.  These rules are designed to help the Government in identifying and addressing circumstances in which a Government contractor may be unable to render impartial assistance or advice.  This report focuses on primary contractors and subcontractors at the Portsmouth Gaseous Diffusion Plant and the Oak Ridge Reservation.  In June 2011, the OIG Hotline received a complaint alleging that there was potential OCI involving contractors Restoration Services, Inc. (RSI) and VETCO, LLC-Technical Services Company (VETCO) at Portsmouth.  The complainant further alleged that potential OCI also existed between contractors URS | CH2M Hill Oak Ridge, LLC, (UCOR) and RSI at Oak Ridge.  We substantiated the allegation that OCI existed at Portsmouth and that potential OCI existed between contractors at Oak Ridge.  Specifically, we confirmed that an OCI existed at Portsmouth involving a continuing financial interest between RSI and VETCO.  We also confirmed that potential OCI at Oak Ridge existed between UCOR and RSI based on impaired objectivity concerning the review of work performed by RSI.  We found that the actual and potential conflicts outlined in our report either had not been properly mitigated or identified by either the contractors or the federal officials involved.  Management comments were generally responsive at both locations and concurred with the recommendations and took corrective actions to address the OCI issues by accepting mitigation plans submitted by the contractors. 

Topic: Management & Administration