Weeks after O'Keefe Media Group released a bombshell investigation exposing how ATI Government Solutions exploited minority-preference programs to secure $100 million in no-bid federal contracts, while subcontracting out most of the work, the Wall Street Journal reports a significant new development: the U.S. Treasury Department has launched an investigation into $9 billion in small-business contracting amid alarming concerns over fraud and abuse in preference-based programs.

Treasury investigators are focusing on pass-through companies that have misused preference-based contracting programs, including the Small Business Administration's 8(a) Business Development Program. The 8(a) program allows qualifying individuals, those who own at least 51% of their companies and have personal net worths below $850,000, to obtain no-bid federal contracts.

Bloomberg quoted SBA Administrator Kelly Loeffler as saying her team directed an audit of the 8(a) program, finding what they believe is "rampant fraud – and increasingly egregious instances of abuse." 

Loeffler noted, "This administration will not tolerate DEI-based contracting and abuse that compromises opportunity for legitimate and eligible small businesses." 

WSJ quoted Treasury Secretary Scott Bessent as saying, "Treasury will not tolerate fraudulent misuse of federal contracting programs," adding, "These initiatives must benefit legitimate small businesses that deliver measurable value to the government and the public."

In June, SBA Administrator Kelly Loeffler launched a formal investigation into the 8(a) program following mounting allegations of fraud. Then, last month, James O'Keefe released a bombshell undercover report exposing how ATI Government Solutions exploited minority-preference programs to rake in more than $100 million in no-bid federal contracts.

Last month, Loeffler and Bessent jointly said the Treasury would suspend all contracting activity with ATI Government Solutions in response to O'Keefe's reporting. 

The latest data from Bloomberg Government shows that obligations tied to 8(a) vendors hit a record $41 billion in fiscal year 2024, with the Pentagon awarding about half of that. 

It's long been an open secret in the Capital Beltway that some firms use pass-through entities or front companies to secure contracts they wouldn't otherwise qualify for. This is precisely the kind of corruption the American people gave President Trump a mandate to dismantle, rooting out the parasites that leech off taxpayers.

And by the way, Dear White House:

"Dismantle the status quo with reckless abandon, or it's socialism for the youth," Mark Mitchell of Rasmussen Reports wrote on X.