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IRS contractor loses SBA certification

Jun. 5, 2013 - 04:09PM   |  
By JIM McELHATTON   |   Comments
Strong Castle Inc., decertified as a HUBZone contractor, is located in Washington's Chinatown section, in the red brick building second from left.
Strong Castle Inc., decertified as a HUBZone contractor, is located in Washington's Chinatown section, in the red brick building second from left. (Thomas Brown / Staff)

The Small Business Administration has revoked the Historically Underutilized Business Zone status of a contractor that has come under congressional scrutiny over nearly $500 million in IRS contracts from last year.

SBA spokeswoman Tiffani Clements told Federal Times in an email that Strong Castle Inc., was decertified as a so-called HUBZone contractor on May 23. The status gives contractors an edge in competing for federal work by being based in economically distressed areas.

Clements declined to provide further details, saying the decision letter contained confidential business information. Strong Castle is located on the 500 block of H Street N.W. in Washington’s Chinatown neighborhood.

Strong Castle, formerly Signet Computers, did not return email or phone messages this week.

The move by the SBA comes one month after the Government Accountability Office denied a protest from losing bidders who raised questions about whether Signet improperly qualified for HUBZone status.

Meantime, in February, the company became the target of scrutiny by the House Oversight and Government Reform Committee.

Rep. Darrell Issa, chairman of the committee, in a letter to the IRS, cited interviews with unnamed witnesses asking for an investigation into whether an unnamed IRS official steered nearly $500 million in technology contracts to Signet.

“Witnesses told committee investigators that Signet may have improperly obtained a HUBZone designation, which likely played a role in the IRS decision to award the company hundreds of millions of dollars in contracts,” Issa wrote in his letter.

The Issa letter also said Signet renamed itself multiple times in 2012 and was also known as Strong Castle. The Strong Castle website notes that the company had been formerly called Signet.

While the GAO ruling noted that Signet was not a HUBZone-certified firm when a bidders list was issued June 20, the IRS pointed out the company did get certified by the time the solicitation closed on July 30. The company lists offices in Washington and Virginia.

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