The Pentagon has fired a shot across the bow of the giant contractor at the center of the CityTime payroll scandal — issuing a scathing audit saying $480 million worth of its federal contracts could lead to fraud or waste.
The audit by the Pentagon’s inspector general paints a picture disturbingly similar to the one investigators found in the $760 million CityTime boondoggle that Science Applications International Corp. allegedly perpetrated in the Big Apple.
The federal contracts under question were given to the Virginia-based firm to build vehicles that can withstand blasts from land mines and roadside explosive devices.
Auditors found problems with the way they were written and carried out, including:
* A serious “risk for potential waste or abuse” because of little oversight.
* SAIC employees being put in charge of government employees — a violation of federal rules.
* Terms allowing SAIC to spend as much money and take as much time as it wanted without incurring penalties.
* Terms allowing SAIC to draft specifications for a contract renewal that ensured the company would be reupped. SAIC ended up as the only bidder on the renewal, which was more lucrative than the original contract.
“You wouldn’t let the contractor in your house do whatever he or she wanted,” said Tom Schatz, president of the watchdog Citizens Against Government Waste. “They end up taking advantage, and that’s why things end up costing so much extra.”
The first deal — covering 2007-09 — was worth $193.4 million. The second covered 2009-11 and yielded $285.5 million for SAIC.
The audit charged no actual wrongdoing.
SAIC spokesman Vernon Guidry said only that the company agreed with the Pentagon that there were no conflicts of interest in the truck contracts.
Last Friday, The Post reported that SAIC landed a deal for the Defense Intelligence Agency, as well as a $7.5 million contract for Navy training. The intelligence-agency contract’s worth was not disclosed.
Ten years ago, SAIC was given a $63 million contract to automate the city’s antiquated payroll system. The cost soared as reports surfaced of conspiracy, bribery and kickbacks.
One SAIC exec has already pleaded guilty, and another is among nine people under federal indictment in the scandal.
Mayor Bloomberg is asking SAIC to reimburse the city for $600 million.