Rutgers – NIGP Conference
May 1, 2014
Atlantic City, NJ
Susan Jacobucci, Esq., CMFO
“The character that takes command in moments of crucial
choices has already been determined. It has been
determined by a thousand other choices made earlier in
seemingly unimportant moments. It has been
determined by all the little choices of years past — by all
those times when the voice of conscience was at war with
the voice of temptation — whispering the lie that it really
doesn't matter. It has been determined by all the dayto-day decisions made when life seemed easy and crises
seemed far away — the decisions that, piece by piece, bit
by bit, developed habits of discipline – or of laziness,
habits of self-sacrifice — or of self-indulgence, habits of
duty and honor and integrity — or dishonor and shame.”

Ronald Reagan, The Citadel, May 15, 1993
 Moral
Compass
 Doing the “Right Thing”
 Following the Rules
 C.I.G.A.R.
 Conflicts
 Information
 Gifts
 Abuse
of Office/Power
 Representation
 Pay
to Play Statutes
 Nepotism
 Form of Government?
 Certifications?
 Limits of Authority

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Am I entering the process as an independent,
objective individual?
Am I am solely in the public interest? (not my
own, a vendor, my superior, my friend)
Am I acting within the statutes, ordinances,
rules…am I coloring within the lines?
Has anything influenced my decisions along
the procurement process?
Have I maintained confidentiality.
Play fair
 Don’t take something that isn’t yours
 Don’t take anything from strangers
 Don’t tell secrets or “talk out of
school”
 Don’t play favorites

 Bid
rigging
 Bid List Sharing
 Procurement manipulation
 Specs specific to one vendor
 Estimate manipulation
 Manipulating lowest, responsive,
responsible bidder definition

Where can things go wrong?
I need a
Widget
Widget
Arrives
What is it
and
where do
I get it?
Placing
the Order
Specs.
RFP,
Quotes
or Bid?
Choosing
Doing the
Work/
Getting
the Item
Paying,
Performance
and
Maintenance
Widget in
Place and
Working
 Who
is coming to you with the
request?
 Do you work with your
“money”/budget person?
 What is your procurement
authority?
Where can things go wrong?
A vendor, superior, “friend” convinces you that
the government agency needs a
widget.[Outside influence]
You have a part of an outside company whose
product you are convinced will help the
agency/or save money… [Conflict/personal
interest]
 What
is it?
 How many?
 Is it within my realm of knowledge
 Research (not only the
product/service) but the trends
and present climate
 What are my options for
procurement?
Where can things go wrong?
Bad description
Narrow description – only a certain company
manufactures it
Only Timbuktu carries it
Maybe its time to rethink the product
Who is writing the description/specs?
 Who is estimating the cost?
 What are the pitfalls of cost
estimation?
 The boilerplate
 Change Orders
 Options in the bidding process
 Too specific or two broad
 Pre-bid meetings - communications


Where can things go wrong?
Procurement officer knew nothing about the item (a fire
engine). Allowed a helpful vendor to write the specs.
Unsurprisingly, the vendor’s company was the only one to meet
the specs.
Purchasing agent let a friendly bidder know the engineer’s
estimate. Vendor underbid and “made up” the difference with
change orders.
 Lowest,
responsive, responsible
bidder
 Getting quotes
 Weighting the bid
 Disclosure of “choice” criteria
 Public Opening
 Sharing of documents

Procurement Officer in a “police
agency” pled guilty to sharing
confidential information with a
contractor about ongoing criminal
probes into the a competing
contractor’s billing practices in
exchange for prostitutes, cash, and
luxury travel.
 The
Contract
 Being clear
 Meeting of the minds
 Payments and timing
 Making sure the bid and
placement of order match
Where can things go wrong?
Make sure everything you agreed to in RFP is in
the order request
Include installation parameters
Include maintenance concerns
Be Specific
Is it what was ordered
 Internal controls
 Who checks
 If installing – what are criteria
 Warranties –how are they
followed/voided
 Maintenance (only widget in the world)




Where can it go wrong?
Consultant conveniently orders extra
computers for his own private side sale.
Purchasing Officer slips a few extra cartridges
of toner in the order.
 It
doesn’t work
 Installation delayed
 Multiple vendors
 Platforms are different



Where can it go Wrong?
Didn’t order it
Voiding the Warranty
 Engineer
or other sign-off
 Performance guarantee
 Maintenance guarantee
 Fails to perform
 Fails to….
 Planned obsolescence

Where can it go wrong?
Payment dates changed
Unforeseen delays
Out of stock, business (better deal comes
along)
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Where are maintenance agreements filed
Spreadsheet or other performance tracking
Fixed Asset
No longer useful – what to do with it?

You are a Procurement Specialist who works
in the State of Greenacre Purchase and
Property Office. Your neighbor of 17 years,
who works for a State lobbying firm, offers
you a ticket to join him for a John Mayer
concert at the Greenacre Center. You are
not sure if the ticket came from your
friend’s lobbying firm or from him
personally. The face value of the ticket is
$375.

A Procurement abused her authority and
improperly used a government vehicle when
she employed a government vehicle and three
employees under her supervision to move
personal property in a government rental
vehicle. The employees helped her for 3
hours.

A government purchasing agent used his
official position to obtain contracts for private
sector companies with which he had an
affiliation. In addition, the PA accepted a
“finder’s fee” (i.e., kickbacks) from one
company for his efforts in helping the
company obtain government contract work.

A Purchasing Agent whose responsibilities
included fleet management and authorization
of repairs of municipal vehicles had
attempted to obtain free repair services for
his personal vehicles from two vendors. The
PA also insinuated to the vendors that the
cost of repairing his personal vehicles could
be recouped as part of the charges for repairs
to municipal vehicles.

The purchasing office employees were part of
a scheme in which they used government
funds to purchase laptops and recycled
computer components from the contractor’s
sales manager at inflated prices, and split the
overcharged amounts among themselves.

In 2005 and 2006, while serving as a
contracting specialist at Camp Arijan, Murray
received approximately $225,000 in bribes
from DOD contractors. In return, he
recommended the award of contracts for
various goods and services. Murray also
admitted that he received an additional
$20,000 in bribes from a DOD contractor in
exchange for the award of a construction
contract
The employee put in an order at the
department print shop, certifying that a
series of posters were for official business.
The posters were actually for the employee’s
side business. Additionally, the employee
purchased a conference table, for which his
own business got a $400 credit toward a
conference table of its own.

In another bribery case at Camp Arifjan,
another Army Major, James Momon, Jr.,
accepted cash bribes from five DOD
contracting firms that supplied bottled water
and other goods and services to bases in
Kuwait. Momon, a contracting officer at the
camp, awarded contracts and Blanket
Purchase Agreement calls to those
contractors, receiving $5.8 million as
payment for his actions. Momon pled guilty
to bribery and conspiracy to commit bribery.