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Agency Employing People With Disabilities Under Investigation Amid Fraud, Corruption Allegations
Published August 4, 2015By Kaitlyn D’OnofrioThe Department of Justice has launched an investigation into SourceAmerica and the AbilityOne program it oversees. The news comes just days after the 25-year anniversary of the signing of the ADA.SourceAmerica is a national nonprofit that was established to oversee and implement AbilityOne, which was created in 1938 and trains and employs individuals with severe disabilities or who are blind.According to CNN, “illegal operations, financial fraud, mismanagement, operating in violation of the law, steering of contracts, and possibly obstruction of justice” are all among the charges being investigated.Companies under contract with AbilityOne pledge that at least 75 percent of their employees have a severe disability and would be unable to work in a traditional job. An estimated $3 billion of taxpayer’s money goes to AbilityOne per year, and this money is supposed to fund these contracts. Supposedly, however, half of the companies in these contracts do not meet the required percentage of employees with severe disabilities.AbilityOne is supposed to approve which companies receive these contracts, but sources have now come forward explaining that this doesn’t happen. More often than not, AbilityOne simply goes with the companies referred to them by SourceAmerica.According to Rich Beutel, former congressional investigator, “The contracts are now being funneled to a very small group of 10 large companies that are getting way more than their fair share.”Beutel, who now lobbies for a company that is suing SourceAmerica, explained that SourceAmerica officials actually have connections to the companies receiving these contracts in many instances.“So [then] you have actual advisers and board members in these private organizations who are themselves business owners; and so they can award themselves potentially contracts worth hundreds of millions of dollars,” he said. “It’s a perfect setup for waste and abuse.”In a statement to CNN, SourceAmerica insisted it follows up and takes appropriate action when necessary:
On average, SourceAmerica staff annually visits nearly 200 of the roughly 500 nonprofit agencies with active AbilityOne contracts to provide training and technical guidance to ensure that every organization with an AbilityOne contract receives the necessary amount of support to meet their contractual requirements. As such, every nonprofit agency with an AbilityOne contract receives an on-site visit at least once every three years, with more frequent visits depending on individual circumstances. SourceAmerica staff does not determine compliance; only the U.S. AbilityOne Commission is authorized to do so.
According to several sources, however, neither SourceAmerica nor AbilityOne follow up with the companies who receive contracts to make sure they actually have the required number of severely disabled employees. Mary Joan Willard is the executive director of the Boston location for NTI, a company formerly under contract with AbilityOne. According to Willard, NTI lost its contract to Peckham Industries, a company which she states does not maintain the mandatory 75 percent.“[AbilityOne’s] definition of ‘verified’ is they look at a piece of paper that Peckham has signed saying, ‘We are in compliance … these people are severely disabled.’ And that, to me, is not verification,” said Willard.Another source, who wished to remain anonymous but is a former hiring manager at a company who received many AbilityOne contracts, corroborated Willard’s explanation.“The majority of the individuals that were being hired were not severely disabled,” said the source. “I would say in my experience in the AbilityOne contracts that I worked on, maybe 10 to 20 percent were truly severely disabled; they truly did not have the ability to find gainful employment elsewhere. Everybody else — they were capable of finding employment elsewhere.”And, to the source’s knowledge, there was never any follow-up from SourceAmerica or AbilityOne to verify this: “As long as you have a report that says 75% of my staff is disabled, there’s no other checking,” the source explained.Supposedly, the only way to know if companies are not meeting their requirements is through their own reports to SourceAmerica — and companies rarely report their own shortcomings. Even in the cases when they did, though, no legal action was taken against the companies.According to SourceAmerica’s statement, “SourceAmerica places a high value on integrity and has zero tolerance for any actions that undermine our ability to create more employment opportunities for people with disabilities.” AbilityOne refused to speak about the matter, citing pending litigation.