Stronger Procurement Controls in the Far East Would Minimize Fraud and Abuse

PSAD-80-2: Published: Nov 7, 1979. Publicly Released: Nov 7, 1979.

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A review of U.S. Government procurement offices in the Far East found gaps in purchasing controls and reports of widespread collusion and bribery. At some locations, where controls were almost totally lacking, collusion and bribery were not even necessary to defraud the Government.

Prohibited and questionable purchases, questionable payments, purchases exceeding authority, inadequate competition, and bribery and collusion were found at most locations visited. Procuring organizations varied widely in their ways of buying and in their success at minimizing abuse. Offices with highly centralized authority and frequent, thorough internal reviews experienced fewer abuses. Also, aggressive corrective action where improprieties were identified helped to minimize abuse. Increased U.S. citizen control helped improve the enforcement of the controls on abuse.

Recommendation for Executive Action

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Secretaries of State, Defense, Army, and Navy and the Administrator of Veterans Affairs should: designate a single office to monitor and assist all Navy procurement activities in the Far East; transfer Veterans Administration procurement authority in Manila, Philippines, to the American Embassy; assure that purchasing activities are periodically reviewed and that problems are corrected; provide Army and Navy enlisted personnel positions for procurement and greater Navy use of U.S. citizens for key civilian procurement positions; and provide emphasis to assure that military departments' procurements are necessary to their missions and guidelines to identify prohibited and questionable items.

    Agency Affected:


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